JACKSONVILLE, Fla. — The Federal Reserve raised interest rates Wednesday by a half point, in its latest effort to ease inflation.
The range between 4.25 percent and 4.5 percent is the highest level in 15 years.
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Michael Brunswick has lived in his Jacksonville home for seven years.
“When I bought my house, it was a very buyer-friendly market, compared to the way houses are going now,” Brunswick said. “I feel like I got a steal on this one.”
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He said times sure have changed.
“I was locked in right around like a 2.25 to 2.5, but I know we’ve talked about refinancing and things like that -- and now interest rates are up,” Brunswick said.
This is the 7th interest rate hike this year, by the Fed.
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That’s the rate banks lend to one another, a cost that’s usually passed along to consumers through higher interest rates on all sorts of borrowing, like car loans and credit card rates.
Abel Harding with First Horizon Bank in Jacksonville shared what consumers should keep in mind this holiday season.
“Holiday gift buying is not that different than grocery shopping,” Harding said. “It’s best to make a list in advance and stick with that list. When you get to the counter, and when you’re ready to check out and make that purchase -- don’t automatically put it on credit. That’s always the temptation anytime in the holidays.”
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Harding said consumer borrowing is more expensive, and it’s going to continue to get more expensive as interest rates go up.
“That’s really where as consumers all of us need to pause and ask ourselves, ‘Is this an essential purchase?’” Harding said.
What about mortgage rates?
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Action News Jax spoke with Mark Rosener, Northeast Florida Association of Realtors’ 2022 President.
“Over the past seven or eight months, mortgage rates specifically have already taken into account the anticipated move by the Fed and what’s going to be,” Rosener said. “From everyone that I’ve talked to, we really believe that mortgage rates have stabilized. The most recent Fed hike of half a percent really probably will not have much of an impact at all on the mortgage rates.”
Rosener said Tuesday’s CPI coming out with inflation down to 7.1 percent was a good sign.
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“It might go up a point or two or down a point or two month to month, but over the last seven months it’s really been between $345,000-$355,000 median price,” Rosener said.
With Christmas approaching quickly, Harding said less is more.
“A thoughtful gift can go a lot longer than a pile of presents,” Harding said. “With higher costs everywhere we go, we do all need to give thought to how much we’re spending and how we’re spending it.”
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