Jaime Gonzalez

President El Paso Association of Builders

Well , the rumor is that the Fed will drop the interest rates . But , before we start celebrating , we need to think about what this means and the potential outcomes for our industry . Lower interest rates could have a profound impact on the housing market , possibly making it more affordable for buyers to secure loans . However , it ’ s not that simple , this isn ' t a straightforward equation . While the possibility of lower interest rates is encouraging , we must also consider the costs of labor and materials . These costs have remained elevated , creating a challenging environment for builders and developers . As the demand for housing continues to outpace supply , the question remains : will

lower interest rates truly make new homes more affordable , or will the higher demand simply drive-up prices ? We all saw what happened when the rates were in the twos . Everything went nuts ! Obviously , I want to have a market where homes sell themselves and we literally can ’ t build them fast enough . But I am also aware that there needs to be a balance between supply and demand . If the cost is unattainable , it doesn ’ t matter what the interest rates are . The reality is that our industry is in a delicate balance . Lower interest rates might make mortgages more accessible , but if the cost of building remains high , the end price for consumers may not see a significant drop .

Furthermore , increased demand can lead to increased competition for existing inventory , pushing prices higher rather than bringing them down . Unfortunately , there are many other factors that influence our market , and many of those are outside of our control . Are lower interest rates better for the consumer , yes ! Are they the silver bullet that will make all our issues disappear , probably not . All things being considered , we have a strong market and a stable economy . I know there can be varying opinions on what this means , but all in all the outlook is great ! I encourage you to keep an eye on the market and proceed with caution , but key word is , Proceed !