The Federal Reserve cut interest rates for the first time in over four years on September 18th.
Montana’s housing market has largely been frozen in place for the last couple years. High interest rates have made buyers hesitant to pull the trigger. Sellers have been reluctant to part ways with historically low rates they locked in during the pandemic.
DJ Smith is a Missoula realtor and president of the Montana Realtors Association. He says the Fed’s half-a-point rate cut could be the spark homebuyers need to jump back into the market. The Fed expects to lower rates by 1.5 points by the end of 2025.
“We’re going to find ourselves here where there could be an argument to buy because you can obviously refinance in the years to come,” said Smith.
Increased buyer demand could drive home prices up. But Smith says lower interest rates make it easier for developers to finance construction of new homes. That could help ease Montana’s inventory shortage, and lower prices in the long run.
Montana lawmakers will consider a slew of recommendations from Gov. Greg Gianforte’s Housing Task Force when they reconvene in January.
