SIOUX CITY, Iowa (KCAU) — Interest rates are up after a recent announcement by the Federal Reserve. The Federal Reserve increased interest rates on loans by 0.75% percent this week.
Real estate experts have said that while the increase in interest rates will help slow down inflation in the long term, it’s a challenging circumstance right now for Siouxland residents, especially for those trying to sell a home.
When Traci Kell put her house up for sale in early June, she did not think she would still be waiting for a buyer.
“The market has slowed down because when we first put it on, houses were going in a couple days and now we’re on day eight,” Kell said.
She’s planning to move to Alabama and said the struggle of buying her next house has been just as challenging as selling her current home.
“It’s going to be a tight schedule to get into another home,” she said. “We might need to rent an apartment for a few months.”
Jason Geary is a realtor with Century 21 ProLink in Sioux City. He said the rate for a 30-year fixed mortgage will now be about 6 percent. He said the high rate is taking a toll in Siouxland.
“Even though the amount of homes for sale is at an all-time low buyers are now having to pay a premium to get those homes and that’s affecting what they’re doing,” Geary said. “So, we’re starting to see the very early signs of a little bit of a slowdown in the Sioux City real estate market.”
Jared Noteboom is a mortgage loan officer with Central Bank. He said the trend of inflation is going down slightly besides gas and food prices, but only time will tell how these higher rates will impact Siouxland.
“The fed with the recent increase is trying to also stem the energy prices and food prices as well,” he said. “So that’s where we’re heading to, now how fast we’ll get there is yet to be determined.”
Noteboom advises people to plan with their loan officer and realtor during this time. He said he does not expect home prices to drop dramatically any time soon.