For the first time in the three years, and the first time since the start of the COVID-19 pandemic, officials with the Federal Reserve announced that they willWhy are they raising interest rates?
Up until now, the interest rate has been near zero as a result of a recession that was induced by COVID-19. The Federal Reserve's decision on March 16 marks the start of its effort to curb the high inflation that followed the recovery from the recession.The decision by the Federal Reserve will eventually mean higher loan rates for many consumers and businesses.Experts say some people are already having to settle for smaller houses in cheaper areas, because housing prices have gone up so much in some parts of the country, including Phoenix.
Sullivan said for years, Phoenix has been an undervalued market, and it was only a matter of time before prices went up. He said raising the interest rate could help lower demand for houses, but not substantially, especially considering the amount of new jobs available in the Phoenix area."Time in the market is beneficial to the investor, and that's what this is. It is an investment," said Sullivan.
Sullivan also said a lot of people who are currently in starter homes might need to stay there for a bit longer, until they can save more money.