The Government Doesn't Determine Mortgage Interest Rates

If you don't already, follow Housingwire. Their Youtube channel is a fantastic, and Logan Mohtashami is an entertaining and informative commentator.

Last week Logan said something just about everyone needs to hear, especially those who have clients want to hold off on decisions because of a pending government announcement on monetary policy. To paraphrase, he said that current interest rates already have the next 6 moves by the Federal Reserve baked in. You can hear the whole broadcast here.

This is brilliant, and worth repeating to consumers when they mention the Fed and rates.

We already know that while there is a relationship between monetary policy, treasury bonds, and rates, there is no direct cause and effect between what the Fed does and how rates go. If the Fed announces a rate reduction, that's already been accounted for by minds way above our pay grades.

The real issue here is not that everyone is walking around calculating monetary policy and bank rates; it is that people are reticent to make decisions and will understandably cite any low hanging intellectual fruit to justify delaying a decision. A good agent has two choices: they can go down the rabbit hole of interest rate esoterica, or they can bring people back to the real criteria for making a real estate decisions: their housing needs.