Across the country, many are faced with the same challenge when buying a home.
Mortgage rates and inflation price many out of the market.
Its energy, groceries and housing that is at its highest right now, and everyone is noticing it. And so right now, housing is more of a luxury. At this point, it’s not even a necessity, says Olivia Gaxiola, a milennial here in Tucson who wants to buy a home.
Gaxiola is not the only member from her generation being priced out by the market.
But good news could be coming in the form of interest rate cuts by the Federal Reserve.
The FED hasn’t made changes to rates since July of 2023, but that is set to potentially change.
“No one has a crystal ball to be able to predict that, but the markets are pricing in that the Fed is going to cut the federal funds rate two times this year and four times next year,” says Derrick Polder, senior loan officer at the Polder Group.
Polder says he thinks the market is approaching the range where home buying will be an option.
“What do I think is kind of a good rate that gets people, they feel like it’s fair, affordable, and gets them excited, usually somewhere around the 5% or 6% range, which we’re right at the doorstep of that,” says Polder.
But Gaxiola isn’t so sure.
“They announced that interest rates are still what, 6.4%? That’s still high. Four years ago, it was four point something, three point something. So it’s still high. And right now, I don’t think it benefits me to buy a home, considering that the rate is still high, says Gaxiola.
A decision on rates could come after the next meeting of the Federal Reserve on September 17th and 18th.