Real Estate Agent · Philadelphia, PA · Member since 2022 · 58 posts · 40 votes
Lower interest rates can have a significant impact on various sectors of the economy. On the positive side, lower interest rates can lead to increased borrowing and spending, which can stimulate economic growth. Consumers may also see lower interest rates on loans, which can lead to increased spending and economic activity. Additionally, businesses may have access to cheaper loans, allowing them to invest in new projects or expand their operations. However, lower interest rates can also have drawbacks, such as lower returns for savers and the potential for inflation if borrowing and spending get out of hand. Central banks must carefully balance the pros and cons of lower interest rates to ensure overall economic stability.
Investor · Youngstown, OH · Member since 2017 · 2k+ posts · 2k+ votes
3y
I prefer to purchase in a high rate environment. I watched countless borrowers offer $20k+ over asking, stress out over appraisal gaps, and waive inspections. And guess what? Once you add that extra principal to the loan and take care of that roof issue that you didn't know about because you never did an inspection, the money you saved getting a 5% instead of a 6% is long gone.
Realtor · Providence, RI · Member since 2022 · 404 posts · 262 votes
3y
I think an additional negative side effect which concerns me today is you get an economy that is riddled with debt. It is not as much of a concern if interest rates stay low, but as they increase it becomes more and more difficult to manage that debt. If your hands are tied with keeping interest rates high because of inflation, I think a recessionary debt clearing event is unavoidable.