Real estate groups urged the Fed to stop rate hikes. Here’s why.

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Top industry advocates voiced 'profound concern' about rising mortgage rates.

The rare public admonishment from top business advocates -- including the National Association of Realtors and the National Association of Home Builders -- underscores a dramatic slowdown in the housing market due in large part to risingMortgage rates have reached their highest level in more than two decades and they have continued to rise.

Sky-high mortgage rates have dramatically slowed the housing market, since homebuyers have balked at stiff borrowing costs and home sellers have opted to stay on mortgages that lock them into relatively low rates.When the Fed initiated the rise of bond yields with its first rate hike of the current series in March 2022, the average 30-year fixed mortgage stood at just 4.45%.

Federal Reserve Board Chairman Jerome Powell speaks during a town hall meeting at the Federal Reserve in Washington, D.C., on Sept. 28, 2023.What role is the Federal Reserve playing in the housing market slowdown?The Fed has fought elevated inflation with borrowing cost increases as it tries to slash price hikes by slowing the economy and choking off demand.

Most notably, the industry groups want the central bank to release a statement saying that it has abandoned consideration of additional rate hikes.

 

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