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'Right now people are buying': Interest rates increasing for home buyers

Federal interest rates went up three-quarters of a percent this week as a way to combat soaring inflation.

MACON, Ga. — Federal interest rates went up three-quarters of a percent this week as a way to combat soaring inflation. So, what does that mean for you when it comes to the housing market?

"We knew that houses were selling for a lot. So, we knew that we would benefit in selling but not in buying," Jack Colwell said. 

Colwell and his wife recently sold their home in Macon. He says once they put it on the market, they got the offer they were looking for in just two days.

"Six families looked at the house, and by the time they looked, we had a bid in the amount that we were asking, and we were pleased to get that," Colwell said. 

Joanna Jones, a realtor with Sheridan Solomon and Associates, says Macon is a hot market right now.

"Right now, people are buying. People are fighting over houses. We can't find anything to sell. Once something goes on the market there's a lot of different offers on it," Jones said. 

But  J.J. Arias, an economics professor at Georgia College, believes that the trend could slow down. He says over the next six months to a year, mortgage rates will increase because of the interest rate hike.

And Arias believes as mortgage rates increase the demand for housing will decrease.

"Sellers are still in control. I don't think they ought to jack their prices up. If they're selling they should sell it at what their agent tells them to sell it, and get it sold right away," Jones said. 

Arias says sellers will need to have lower asking prices. So, they'll want to buy and sell sooner rather than later.

Colwell and his wife plan to move to a suburb in Savannah. He says you get so little interest on savings now that they're better off having it in a house.

"By paying more for the one down there. We'll have more invested in a house and less in savings. It wasn't unexpected that we'd pay a lot for a house where we're going," Colwell said. 

Arias says he thinks the feds are going to keep increasing their target rate in the next six to twelve months.

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