How will the federal interest rate hike impact home builders, buyers?
CBS - 17 WNCN (Raleigh-Durham, NC)
CARY, N.C. (WNCN) -- After the Federal Reserve's latest interest rate hike, CBS 17 is digging deeper into the impact it's having on home builders and those who plan on buying homes.
Economists say the goal of these interest rate hikes is to slow inflation.
Home builder Wes Carroll tells CBS 17 the increases give them more stability when it comes to building prices and the cost handed down to the buyer.
"We're now able to better forecast when we're starting a home what the cost is going to be in that home whereas six to eight months ago, we really didn't know until we almost had the home built," said Carroll, who is also the state home builders' association president.
In some markets the rate increases are causing sales to drop, but economists say that's not happening in the Triangle because buyers here tend to make more money than buyers in most other areas and can afford the higher prices.
"Wake County still is seeing 62 people per day net gain," Carroll said. "Our income level has kept up with the pace of home price increases."
Carroll said our economic situation is much different from the 2008 recession when a lot of money stopped flowing so builders stopped building and people weren't borrowing money.
For now, he believes the banks are still confident in the economy.