Today, Groundwork Collaborative released a new video featuring Chief Economist Dr. Rakeen Mabud, who explains how the Federal Reserve’s refusal to lower interest rates is keeping housing costs high and making it more costly and more difficult for people to buy or even rent a home. The video comes ahead of the Federal Open Market Committee meeting on April 30 and May 1, where the Fed will announce the path forward on interest rates in the coming months.
“The Fed has jacked up interest rates to the highest level in 20 years. When the Fed raises interest rates, mortgage rates rise too. That means that many prospective homebuyers are priced out of the decision to buy a home. Where do these potential buyers go? Back into the rental market, increasing demand among renters and pushing up rent costs,” Mabud explains in the video.
“The Fed’s high interest rates also make building housing more expensive, and some reports find that we are short as many as six and a half million homes. That’s a housing crisis of epic proportions.”
“Even though sky-high interest rates are keeping inflation high and worsening an already dire housing crisis, the Fed may delay in cutting rates. It’s time for the Fed to cut interest rates and get our housing market moving again.”
