Fed Cuts Interest Rates a Half Point

Posted by Jonathan Karlen on Wednesday, August 31st, 2011 at 10:42pm.

real estate louisville kyThe Federal Reserve cut interest rates much more sharply than expected. Most analysts believed 1/4 point was the most likely avenue for them to move – but in a stunning shocker, they cut it a full 1/2 point. The benchmark interest rate plunged from 5.25 to 4.75 percent.

The move was made to help buoy up the lagging housing market in many parts of the country as a result of over valuation and the subprime lending market that has been taking a beating, and to help stimulate the economy. The stock market moved up 335 points as a result of the news.

So, what does that mean to persons interested in Louisville KY Real Estate? Remember, Alan Greenspan just announecd his prediction that in a few short years, that interest rates will have reached double digits.

If you do an analysis now, here’s what you have:

NOW: Low interest rates, real estate on sale

FUTURE: High interest rates

CONCLUSION: If you whip out your crystal ball to look into the future, this means that you can expect more persons to be renting in the future as they won’t be able to afford to own their own home due to rising interest rates – and if you buy now, you can lock in a long term 15 or 30 year low interest rate mortgage, and buy the real estate on sale right now to boot.

Thats a Win-Win-Win.

Its a GREAT time to buy – particularly if you are upsizing, or interested in making a real estate investment purchase.


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