News from the South - Florida News Feed
Fed goes with half-point interest rate cut. What that means for you | Quickcast
SUMMARY: In today‘s CBS News Miami Quickcast, the Federal Reserve is expected to cut interest rates for the first time in over four years, aiming to lower borrowing costs and prevent a recession. Miami is experiencing heat and storms, with temperatures rising into the 90s. A fire in a Miami Beach high-rise was caused by a charging electric scooter, though no injuries occurred. Jalisa Hill pleads not guilty to orchestrating her grandparents’ murder. Sean “Diddy” Combs faces serious charges, including sex trafficking. Meanwhile, a solar panel canopy was unveiled in Fort Lauderdale, part of efforts to increase renewable energy in the community.
In today’s Quickcast:
The mortgage rate landscape is undergoing a rapid transformation now that inflation is cooling. For starters, there has been a notable drop in mortgage rates over the past few weeks, with rates hitting a two-year low on Wednesday. This shift has already begun to stir excitement, as more affordable borrowing costs open doors for those previously priced out of homeownership.
The Federal Reserve also conducted its first rate cut since 2020 on September 18, reducing the federal funds rate by an unexpected 50 basis points. Most analysts expected the Fed rate cut to be just 25 basis points, making this decision larger and more impactful than anticipated.
This move is expected to put additional downward pressure on interest rates across the board, including mortgages, and may present an opportunity for borrowers to lock in more favorable rates. But how exactly will this substantial Fed rate cut impact mortgages? Below, we’ll break down what you should know.
See how low of a mortgage rate you could lock in here today.
Here’s how the Fed’s big rate cut affects mortgages
The Federal Reserve’s decision to implement a 50 basis point rate cut has injected a new layer of complexity into the mortgage market. While the impact of a standard 25 basis point reduction has likely been factored into current mortgage rates, which are sitting at an average of 6.15%, it’s unclear exactly how mortgage rates will respond to this larger rate cut.
One outcome could be that the larger rate cut will cause mortgage rates to fall even further in the coming days and weeks, building on the recent trend of declining rates. This could create a more favorable environment for borrowers, with the possibility of mortgage rates dipping to levels not seen in years.
However, it’s crucial to understand that the Federal Reserve’s actions, while significant, are not the sole factor influencing mortgage rates. The mortgage market is a complex ecosystem affected by various economic indicators. Long-term bonds, particularly the 10-year Treasury yield, also play a pivotal role in determining mortgage rates. So while the Fed’s rate cut will likely push these yields lower, other factors can also sway bond yields and, consequently, mortgage rates.
The mortgage industry itself may also play a role in tempering any dramatic rate drops. For example, lenders might be hesitant to lower rates too quickly or too far as they balance their desire to attract borrowers with the need to maintain profitability. This could result in a more gradual decline in mortgage rates rather than an immediate, sharp drop.
For potential homebuyers or those considering refinancing, the Fed’s larger-than-expected rate cut presents both opportunities and potential challenges. On one hand, the prospect of lower mortgage rates is certainly appealing. Lower rates translate to more affordable monthly payments and increased buying power, potentially allowing borrowers to qualify for larger loans or more desirable properties.
The bottom line
The Federal Reserve’s unexpected 50 basis point rate cut will likely have a noticeable effect on the mortgage market, but its exact impact remains uncertain. While lower rates may materialize in the short term, a range of factors will influence how mortgage rates move in the future. So, homebuyers and homeowners who plan to refinance should carefully consider their options, recognizing that waiting for the perfect moment could be risky in an unpredictable market. Securing a favorable rate now may be the best course of action instead, especially with rates already at a two-year low.
The allure of lower rates could also bring its own set of complications, however. If mortgage rates decline even further, it’s likely to attract more buyers to the market. This increased demand could lead to heightened competition for available properties, potentially driving up home prices and offsetting some of the benefits of lower interest rates.
Those waiting for rates to bottom out before making a move may also find themselves in a precarious position. Timing the market is notoriously difficult, and there’s a risk that rates could begin to rise again before you can act. After all, economic conditions can shift rapidly, which could reverse the current downward trend in rates.
Lenders are also more likely to see an uptick in inquiries and applications in the wake of the Fed’s decision. This increased volume could lead to longer processing times and potentially stricter underwriting standards, so borrowers should be prepared for this possibility and consider getting pre-approved or starting the application process early.
Find out how low your mortgage loan rate could be now.
Catch the Quickcast with Najahe Sherman weekdays at 4PM ET streaming on the CBS Miami app and CBSMiami.com
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News from the South - Florida News Feed
Residents near I-275 push back against proposed widening project
SUMMARY: Hillsboro County faces opposition from local residents concerning proposed I275 expansion aimed at alleviating traffic growth. Local resident Jason Marlo emphasizes that increasing traffic, noise, and pollution will negatively impact their quality of life and property values. Many community members argue against spending nearly half a billion dollars on a project that merely adds lanes when alternatives, like enhancing public transportation, could be more effective. Past efforts to expand I275 met similar resistance a decade ago, and frustrated residents are ready to organize against the current proposal, highlighting their desire to preserve their neighborhood’s integrity.
The project would add north and south bound lanes between the Hillsborough Avenue and Bearss Avenue exits.
News from the South - Florida News Feed
South Florida weather for Wednesday 9/18/24 11PM
SUMMARY: A light show off the coast signals quiet weather in metro areas, with interior showers primarily over inland locations. Some activity persists in the Keys. The temperatures soared to the mid-90s before storms helped cool the region into the 80s. Tomorrow promises morning showers and afternoon storms focused on the East Coast. Monitoring a developing low pressure system with a 50% chance of intensifying in the Mid-Atlantic. Rain chances are low in the morning but increase in the afternoon, peaking around 20%. A breeze from the Northeast will help lower temperatures slightly into next week.
CBS News Miami’s meteorologist Dave Warren’s weather outlook for South Florida.
News from the South - Florida News Feed
Caribbean shows potential tropical development by middle of next week
SUMMARY: Fox 35 Storm Team meteorologist Laurel Blanchard provided an update on tropical developments, noting two key zones of interest: one in the central Atlantic with a 50% chance of development, near Bermuda, and another in the Southern Caribbean with a 30% chance. The central Atlantic system isn’t expected to threaten the US. However, the Caribbean system poses a potential threat to Florida, as warm ocean waters near 86°-87° could facilitate rapid development. A low pressure may form early next week. With the hurricane season ongoing, the next named storms include Helen, Isaac, Joyce, and Kirk.
The FOX 35 Storm Team is monitoring two zones for potential tropical development. The first is in the Southern Caribbean, where there’s a 30% chance of a system forming in the next seven days. While models vary on the possible strength and path of the storm, warm ocean temperatures in the region could lead to rapid development if a system forms. The second zone, in the central Atlantic, has a 50% chance of forming within the week but is expected to remain in open waters, posing no threat to the U.S.
Get your tropical weather forecast each day during hurricane season from the FOX 35 Storm Team. We’ll issue a new hurricane update each day, and more frequently when needed.
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