YORK COUNTY, Pa. — The Federal Reserve is expected to raise interest rates once again on Wednesday.
“It will be [a] moderate, small, maybe a quarter of a percent increase," said Pavlo Buryi, associate professor of economics at Harrisburg University of Science & Technology.
It comes as the economy shows signs of slowing down and recessionary fears grow.
Multiple bank failures and layoffs at large companies are only compounding those worries.
“All those things point in the direction that even successful companies are realizing cash might be scarce in the future so they’re cutting some of those risky investments and trying to be more conservative," explained Buryi.
Meanwhile, the housing market remains volatile, as many homeowners who would otherwise be selling are holding off due to those high-interest rates.
“If you were able to lock in at a low-interest rate, your monthly payment is affordable relative to rent or acquiring a new mortgage at a higher interest rate," said Buryi.
That’s bad news for an already low supply of houses for sale.
“There is no inventory so the buyers are out there but there is really not much to buy," said Reid Weinbrom, president of the Realtors Association of York & Adams Counties.
First-time homebuyers are also struggling big time.
According to the Realtors Association of York and Adams Counties, this demographic is only making 31% of the market, when they usually account for half.
“First-time home buyers are in the lurch now," said Weinbrom. "With increasing interest rates, about three percent over the course of the year total is for sure a problem.”
The National Association of Realtors is also concerned about the Biden Administration's new mortgage fee structure.
The group believes the hikes are unnecessary and given the sharp rise in mortgage rates over the last year, no home buyer should be facing higher fees.
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