Fed Issues Emergency Interest Rate Drop to Counter Coronavirus Effect

Published by Joe Moshe on

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The Federal Reserve (colloquially referred to as “the Fed”) issued an emergency interest rate drop on March 3 in response to market pressure from the coronavirus outbreak. The coronavirus has caused panic worldwide, with companies that rely on Chinese manufacturing particularly affected by disruptions in trade. While the reduction in interest is intended to help buoy the market in the face of major economic uncertainty, it may also prove to be a major boon for anyone looking to purchase real estate right now, particularly in costly areas like New York.

                The Federal Reserve is the central bank of the United States of America, which exists to help stabilize the markets, maximize employment, and maintain the stability of the financial system. Among the most potent tools the Fed has at its disposal is the ability to affect the federal funds interest rate, which is the interest rate at which banks may lend money to one another. Raising or lowering the federal funds interest rate, in turn, determines the rate at which banks and other financial institutions will lend money, making it a significant way of impacting lending throughout the economy.

                The Fed lowered the interest rate as a way of spurring lending despite economic worries over the coronavirus. As a result, all other forms of debt, including mortgages, can now be obtained with a substantially lower interest rate than they could have been before. If you have been considering buying real estate, particularly in New York, now may be the time to start looking at financing, because you may not be able to get a better deal once the panic over the coronavirus subsides.

                In this kind of market, it’s important to have an agent to help you find a house that meets your needs. Charles Rutenberg Realty is one of New York’s largest Real Estate companies with multiple offices providing a full suite of real estate services, including residential and commercial sales or leasing. We serve clients in Nassau, Suffolk, Queens, Kings, Bronx, Westchester, Putnam, and Orange Counties, and bring our knowledge and experience to bear in every transaction. If you are interested in buying, selling, or leasing real estate, give us a call at 516-575-7500 or visit our contact page.

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Joe Moshe

Joe Moshe is the Broker/Owner of Charles Rutenberg Realty Long Island, offering 100% commission to Agents. With over 1000 agents, it's one of the fastest growing, most progressive real estate brokerages on Long Island.

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