CAPE CORAL, Fla. \u2014 The Federal Reserve’s decision to cut interest rates Wednesday sparked renewed optimism among Southwest Florida real estate brokers, who said they hope it will help kickstart a sluggish real estate market. <\/p>\n
WATCH: FOX 4’s Hunter Walterman sits down with Cape Coral brokers after Federal Reserve cuts interest rate: <\/p>\n
Could interest rate cuts help jumpstart Cape Coral housing market? Local brokers weigh in<\/p>\n
Federal Reserve Chair Jerome Powell announced a quarter point cut Wednesday – the first cut since December. <\/p>\n
It’s a much-anticipated move that has mortgage brokers and real estate agents fielding calls from clients eager to understand what it could mean for their home buying or selling plans.<\/p>\n
“They [the Fed] are moving in the right direction, downward now” said Tony Lee, owner of Edison Mortgage, Inc. in Cape Coral. <\/p>\n
The cut comes as parts of Southwest Florida’s housing market slowed from red-hot pandemic highs. In Lee County, homes currently spend an average of 107 days on the market, according to Realtor.com \u2014 nearly a month longer than last year.<\/p>\n
“Sales have definitely slowed down,” said Nathaniel Hajjami, a Cape Coral realtor who said some potential buyers retreated to the sidelines.<\/p>\n
“There’s a lot of people that I’ve been working with that decided, let’s wait and see what happens,” Hajjami said.<\/p>\n
Cape Coral’s housing inventory has returned to pre-pandemic levels, Hajjami said, with more than 3,000 single-family homes currently for sale, according to MLS.com.<\/a><\/p>\n Many clients remain unable to afford homes, Hajjami said. That’s partially because some sellers and real estate agents have remained stubborn on price, Lee said. <\/p>\n “They still think the house might be the 2022 price, when it’s not,” Lee said.<\/p>\n Home prices have started to tick down – somewhat dramatically in some parts of Southwest Florida. A Consumer Affairs report<\/a> finds North Port home prices dropped more than anywhere else in the country over the past year. <\/p>\n In August, the median Lee County home sale price was $355,000, according to Realtor.com – that’s down from $375,000 in August of last year. <\/p>\n “We’ve had insurance go up, we had interest rates go up, and we had house prices go up quite a bit from the whole COVID everybody moving down to Florida bit,” Lee said. <\/p>\n “So now we’re starting to see interest rates go down, insurance has kind of stabilized a little bit, we’re getting some new carriers coming into the state of Florida,” Lee said. “So we are starting to see a little bit more competitive pricing there, which is good.”<\/p>\n However, the Fed’s rate cut doesn’t guarantee home prices will drop. Over the past two decades, home prices increased faster than income across much of the country, according to a U.S. Treasury report<\/a> <\/p>\n “We don’t set mortgage rates, but our policy rate changes do tend to affect mortgage rates,” Federal Reserve Chair Jerome Powell said Thursday.<\/p>\n