How Fed Policy Will Impact Idaho Mortgage Rates in 2025

🏦 Fed's June 18 Decision: Steady, But Watchful

Today, June 18, 2025, the Federal Reserve held its benchmark federal funds rate at 4.25% - 4.50%, marking the fourth consecutive pause. The Fed's tone? Watchful. They’re focused on incoming economic data, persistent inflation concerns, and the impact of global events like tariffs and geopolitical tensions.

Most importantly, the Fed signaled two expected rate cuts later this year - most likely in September and December. This marks a slight shift from previous expectations of three cuts, showing they're easing up, but cautiously.

🔍 Fed Policy Mortgage Rate Forecast: What It Means for Idaho

🕐 Near-Term (Next 1 - 2 Months)

• Mortgage rates should remain relatively flat with slight downward movement possible.

• As of today, 30-year fixed rates are hovering around 6.82%, while 15-year options are closer to 5.95%.

• Stability will reign until the Fed gets clearer signals from inflation and job market data.

📉 Mid-Term (3 - 6 Months)

• If the Fed cuts rates as projected this fall:

  • Mortgage rates could drop 0.25% to 0.50% - bringing 30-year rates into the low-to-mid 6% range.

  • Refinancing and new purchases may become more appealing as affordability improves slightly.

• However, if inflation flares up again or job numbers stay too strong, the Fed might hold tight longer - keeping mortgage rates from falling as much as hoped.

🏠 Should You Buy a Home Now?

This is the big question - and the answer depends on your timeline, financial situation, and local market conditions. Here's how the Fed's current policy affects that decision:

✅ Reasons to Buy Now

• Home prices in Idaho are stabilizing, and in some areas like Nampa and Caldwell, price growth has slowed, giving buyers more leverage.

• Inventory is improving, especially for new construction. Builders are offering incentives again - including rate buydowns, closing cost credits, and more.

• Locking in now protects you if rates unexpectedly rise again due to inflation or global instability.

• Owning a home means building equity instead of paying rent, especially in a market where rental costs remain high.

🤔 Reasons to Wait (Just a Bit)

• If your budget is tight, waiting a few months for mortgage rates to dip might save you hundreds each month.

• You may have more buying power this fall if rates drop as expected, especially if inventory continues to grow.

• If you’re in no rush and can be strategic, watching how the Fed acts in September and December could position you better - both for rates and potential price reductions if demand slows.

⚖️ Final Take: Buy Now, or Wait?

If you've found the right home and can comfortably afford it - don't wait for a "perfect" rate. Perfect timing is rare in real estate, and the opportunity cost of delaying could outweigh small rate drops.

But if you're flexible and want to maximize affordability, keeping an eye on the next few Fed meetings might reward your patience.

💡 Pro Tip: Work With a Local Expert

At 1st Choice Mortgage, we've helped hundreds of Idaho buyers navigate markets just like this. We'll help you:

• Run break-even analyses on buying now vs. waiting.

• Explore rate lock strategies or temporary buydowns.

• Position you to refinance when the time is right.

Whether you’re buying today or six months from now, we’re in your corner.

📝 Blog Summary

• The Fed held rates steady but signaled two rate cuts by end of 2025.

• Mortgage rates may ease into the low-to-mid 6% range by fall.

• Buyers should weigh personal readiness vs. rate savings potential.

• Either way, partnering with a trusted local lender ensures you’re getting the best options available.