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Fed cuts rates again.

Last Wednesday, the Federal Reserve lowered its benchmark interest rate by a quarter of a percentage point in an effort to revive this stagnant economy. This represents the sixth rate cut so far this year, though all five preceding cuts were a half-point each.

The federal funds target rate on loans is now down to 3.75 percent, a level that it hasn't hit since 1994.

"The immediate impact of all this on real estate is pretty positive. The real estate market is still in decent shape," said Tim Welch, executive managing director at the Cushman & Wakefield financial services group.

Welch added that, by and large, there has been "good control on new construction", unlike a past market when speculative building fueled the real estate crash.

Despite Welch's optimism, interest rate cuts tend to take six months before impacting the economy.
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Author:CHAPMAN, PARKE
Publication:Real Estate Weekly
Article Type:Brief Article
Geographic Code:1USA
Date:Jul 4, 2001
Words:141
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