Tallahassee Real Estate Blog

At an Open House I was hosting the other day, a couple mentioned to me that they were waiting to buy a home because mortgage rates were sure to fall as the Federal Reserve cut interest rates. 

This highlights a common myth that mortgage rates mirror the Fed's rate actions.  Not true.  30 year mortgage rates are most closely tied to movements of 10 year Treasury Bonds.  Bonds and mortgages are impacted by a variety of factors, including the probability of future inflation.  In fact, there are times where a Fed rate cut will RAISE mortgage rates if investors feel the action will make inflation more likely.  Such could be the case now, where many mortgage analysts think rates will rise in the next 2 months as the economy does show some signs of future price inflation.  

But guessing the direction of future rates is risky business.  If you want to purchase a home, don't try to time the market.  Look for the home that fits your needs, and work with your Realtor to buy at a fair price. 

If you are more concerned about making money in real estate, that's another thing...  find a Realtor that does investment analysis, and buy some investment property - good values can be found!

Whether you are looking for a home or investment property in Tallahassee, call Terance Keenan and his Team - we can help!  850.445.2476!