Fed's Rate Cut

We wanted you to be the first to know that this morning the Fed lowered the discount rate by ¾ of a percent. This is the rate that has a direct impact on mortgage rates. We expect this change to have a substantial impact on the real estate market. Already today we have seen one lender offering 5 ½ % rates with no points! We look for even more aggressive pricing as the day progress’s.

Last July when the sub prime market crashed it “froze” our market leaving many sellers lowering their prices below actual market value and creating a lot of “low hanging fruit”. We expect that the Fed lowering the interest rates will jump-start our spring market early. The lower rates and the “low hanging fruit” mean unprecedented opportunities for the “early bird” buyers.

We have all been reading tales of doom and gloom regarding our real estate market and, it certainly has been better for buyers than sellers. However, while 2007 was certainly no 2004, it was still the 4th best year on record for real estate sales.

Our thinking is that this action may be politically motivated meaning that these lower rates may not be around for long. In addition, the “low hanging fruit” we spoke of will be plucked off the market quickly by savvy buyers. Bottom line, those that act early will reap the greatest rewards.

Spencer

P.S. More good news – Northern Virginia is ranked #3 for new jobs created in the nation – this is what sustains our local market and why our market does not feel anywhere near the pain that other states are feeling. Real Estate is a local business!

We update our local market stats monthly as we compile the information – check them out on our website under Local Information/Stats