Stock Market is Up, and what it Means for Real Estate Industry

Real Estate Agent with Century 21 Sundance Realty

On Monday, the Fed made a surprise announcement to increase the length of time banks can use funds through the "Fed Window". Keeping things simple, banks have longer time to "pay back" the Fed on borrowed funds. This should help banks increase the amount of money available for loans with less risk to their shareholders. The Dow Jones Average was up over 400 points on Tuesday as a result.

People have been afraid to make big ticket purchases in times of uncertainty including cars, houses, luxury items. Consumer confidence will need to be restored in order to begin to get America spending again.

 There is a Fed Meeting March 18, and there are signs that point to yet another rate decrease. If you are rate watching, next Tuesday and Wednesday are key dates for price changes. Depending on the expectations of the market place, you may find a decrease on one of those days. Typically, the market will "price in" expected decrease the day before a Fed meeting. If the expected decrease takes place, markets the day of the meeting may remain flat or decrease a bit more. If the expectations are not met, and the Fed does not lower the rate as anticipated, you may find that rates actually go up from the day before the meeting's prices. It's a roll of the dice for rate watchers.

If you are even thinking of purchasing or refinancing, please contact me prior to the close of business on Monday March 17. If you are serious about locking in on Tuesday or Wednesday, we will need to get your numbers and information worked out in advance. It should be very busy 2 days for locking in loans. If you file is not fully complete, we may have challenges getting you locked in a low interest rate.

Anna Lukyanova
Century 21 Sundance Realty 1102 Pelican Bay Dr. Daytona Beach, FL 32119
Cell: 386-405-7784
Fax: 386-761-2713
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Comments (7)

Matt Crow
Huntley Realty - Huntley, IL 630-728-6051

It's going to be a GREAT '08!

Be of service! The rewards will come!

Mar 12, 2008 06:47 AM
Ken Tracy
Coldwell Banker Residential - Naperville, IL
Helping clients buy and sell since 2005

Great job Anna.  Well written post.  Your profile looks great too.

Keep it up,


Mar 12, 2008 06:49 AM
Jeremy Blanton
Myrtle Beach Homes Blog - Myrtle Beach, SC
Myrtle Beach REALTORĀ®-

Like the post! 

Mar 12, 2008 06:55 AM
The Michael Pierce Team
Better Homes & Gardens Kansas City Homes - Leawood, KS
Kansas City Real Estate Experts

Hi Anna,

For the longer term, I am actually hoping the Fed does not continue to slash the Fed Funds Rate.  Uncle Ben is able, and starting to free up liquidity in the market by other means without cutting rates.  The Fed has been moving the Funds rate quiet a bit lately to free up the markets but the problem is more of a liquidity problem then anything else.  By continuing to lower the Fed Funds Rate, he will be (or has been) adding fuel to the inevitable inflation problem we will be facing not too far down the road. 

Mar 12, 2008 06:56 AM
Anna Lukyanova
Century 21 Sundance Realty - Daytona Beach, FL

Matt, couldn't agree more. After all we are in the service industry.

Ken and Jeremy, Thanks for stopping by.

Michael, you are right, the problem of inflation could arise quickly, and it has always been a tricky business trying not let it out of control.

Mar 12, 2008 07:21 AM
Midori Miller
Talk 2 Midori, LLC - Daytona Beach, FL
Online Marketing For Real Estate Professionals
Anna-interesting!  Let's see what they have up their sleeve...
Mar 12, 2008 08:40 AM
Anna Lukyanova
Century 21 Sundance Realty - Daytona Beach, FL
Midori, March 17th is right around the corner. We shall see very soon.........
Mar 12, 2008 09:31 AM