Thoughts on the Rate Cut News
Whenever news of a rate cut comes out, everyone says "housing prices are going up now," but I'm a bit skeptical. I feel like there are too many variables in the market right now to explain it with interest rates alone.
Of course, it's true that the burden of loan interest goes down, so demand will pick up. But whether that actually leads to real transactions or just pushes up asking prices is something we'll need to watch a bit longer. There have been several times before when the market got excited over similar news and then quieted down within a few months.
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I agree—explaining housing prices with interest rates alone is a bit ridiculous.
I feel the same way. Rate cut news is often already priced in, so I've seen many times that once the announcement actually comes out, only securities briefly stir and then it fizzles out. You have to look at actual trading volume as well.
Got a source? Can you back up “we’ve gotten excited over similar news before” with statistics?
Well, isn’t that a bit of an outdated take? Right now loan regulations are heading toward easing, and there’s quite a lot of pent-up demand from end users, so if a rate cut becomes the trigger, things could move faster than expected. Being unconditionally skeptical is also risky.