For commercial real estate, lower interest rates could translate to additional market opportunities as well as some risks. For the first time since December 2008, the Federal Reserve lowered the Fed Funds Rate three times with the most recent cut occurring in October 2019. The rate has recently been cut to 1.50 to 1.75 percent in hopes to prevent a recession. While a lower Fed Funds Rate translates to cheaper borrowing costs and lower cap rates, allowing for more purchasing, there are concerns in the market that this may result in price inflation.
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Tags: interest rates
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