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SALT LAKE CITY — Mortgage rates are finally back below 7% for the first time since August. The news comes as the Federal Reserve kept interest rates steady on Wednesday. Many experts believe that the Fed may start cutting interest rates in 2024.
This is good news for the local market, Dejan Iskic, a senior research fellow at the Kim C. Gardner Policy Institute at the University of Utah, told KSL NewsRadio.
He said it would save people about $300 a month in payments, compared to just two weeks ago.
“It makes a big difference for people,” Iskich said. “Being able to save a little more and save $300 a month — it’s huge.”
Utah has suffered from a major housing shortage for some time. Add that to the tens of thousands of people moving to the state each year, and demand for homes in the Beehive State has increased. As well as its purchase price.
As of Friday, the average price to buy a home in Utah was about $500,000, Eskich said.
While lower mortgage rates are beneficial to some buyers in the short term, Eskitch believes they will in turn lead to higher home prices over time.
As demand rises, prices also rise.
What’s the solution?
Utah leaders, including Gov. Spencer Cox, have been aggressive in trying to build more homes in the state. Lawmakers also created a loan program to help lure first-time buyers in the door.
Iskic said the country needs to build more homes overall, but he believes we need to focus on building different types of housing.
“We have a culture of large families,” Iskic said. “If we want to maintain that, we have to house our children.” “I don’t know how you can do that by owning a quarter-acre lot.”
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