1/4% rate cut - Is that enough to help the Phoenix Housing Market?
April 30, 2008
The Federal Reserve lowered a key U.S. interest rate ( FED rate cut ) by a modest quarter percentage point on Wednesday.
More importantly, the FED hinted the move could be the last in a series dating to mid-September.
The question on the minds of Wall Street and Main street is , “is this enough to stimulate the economy and the housing market” ? - can it help real estate sales in Metro Phoenix ?
Clearly, the President, Congress and the FED are taking action to help stimulate growth and help real estate to prevent either a recession or further recession, depending on who you ask.
However, rate cuts (for the most part) have not helped most of the economy and the all important bond market (which dictates mortgage rates) has not risen much forcing interest rates down only slightly down this year.
The FED meets again in June. The question is on everyone’s mind; Are they done cutting rates? and , w ill rate cuts help stop a real estate market decline?
Opinions differ. Look at these 2 opposing opinions
Rate Cuts May Not End As Soon As Wall Street Thinks - by CNBC
and
5 Reasons the FED is Done - or Should Be! - US News & World Report
personally,.. I like the current position. Certainly , with rising gas and food prices, declining housing prices and consumer spending a weak dollar abroad, we clearly need further cuts.
In Arizona, at least in the greater Metro Phoenix area, we need more than most.
However, the economy needs some time to absorb the massive 2.5% drop in the last 3 months to offer a more clear indication of where we are and where we need to go.
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Copyright © 2008 By James Wexler, All Rights Reserved. *1/4% rate cut - Is that enough to help the Phoenix Housing Market?*
Contact James Wexler (480) 221-8080 for all your Phoenix | Scottsdale area Real Estate needs.
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