Trump’s New Fed Pick & Idaho Mortgage Rates: Will It Matter?

It has been a busy week in the financial world. On top of the Super Bowl preparations, the headlines are buzzing with the news that Kevin Warsh has been nominated as the new Chairman of the Federal Reserve.

Since the announcement, my phone has been lighting up with the same question: “Jerry, this guy is pro-rate cuts. Does this mean mortgage rates are about to crash?”

It is a fair question. But the answer is a little more complicated than what you hear on the nightly news.

Here is the truth about the new Fed Chair, what actually moved rates this week, and why waiting for a “political miracle” might be a mistake for Idaho homebuyers.

The Myth: “A New Chair = Lower Rates”

There is a belief that if we put a “rate-friendly” person in charge of the Fed, mortgage rates will instantly drop.

The Reality: The Market is Faster Than the Fed.

The bond market (which drives mortgage rates) is incredibly efficient. Traders on Wall Street have known for months that a new, more “dovish” (low rate) Chair was likely coming.

This means they have already priced it in. By the time the nomination was officially announced, the market had already adjusted. Mortgage rates respond to inflation and economic data, not just the person sitting in the big chair.

What Actually Happened This Week? (The Real Data)

While everyone was talking about Kevin Warsh, the real story was happening in the labor market.

This week, we saw some crucial economic reports come out:

• Jobless Claims Rose: New claims hit 231,000 (up from 212k previously).
• Job Openings Dropped: The “JOLTS” report showed openings fell to 6.5 million.

Why this matters for your mortgage:
Bad news for the economy is often good news for mortgage rates. Because the job market looked a little “weaker” this week, investors flocked to the safety of bonds, which helped keep mortgage rates steady in the low 6% range.

The Local Angle: Don’t Wait for Washington

While D.C. plays musical chairs, the housing market in Canyon County isn’t waiting.

We are seeing inventory move faster in Nampa and Caldwell than we did in December. Prices are firming up. If you sit on the sidelines waiting for Kevin Warsh to take office and “fix” rates, you risk paying $15,000 – $20,000 more for the same house due to spring price appreciation.

The Secret Weapon: FHA and VA Loans

If you are worried about rates hovering in the 6s, remember that you have powerful tools available right now:

• VA Loans: For our veterans, this is hands down the best loan on the planet. 0% Down, no mortgage insurance, and typically lower interest rates than conventional loans.
• FHA Loans: Perfect for first-time buyers. You only need 3.5% down (which can be a gift from family!). Plus, FHA rates are often more forgiving if your credit score isn’t perfect.

The Bottom Line:
Don’t bet your financial future on a politician. Bet on the data. The data says rates are stable, and Idaho home prices are rising.

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