The Fed Raised Rates to 3.75-4.00%. What It Means for Miami Buyers, Sellers and Condo Boards

On September 16, the Federal Reserve raised its federal funds target range by a quarter point to 3.75% to 4.00%. The vote was 12-0. Reuters reported it was the Fed's first hike in three years and the first policy move under Chair Kevin Warsh. The statement's explanation was short: “Inflation remains elevated.”

What the Fed said about housing

Eighteen participants submitted projections. Their median puts the rate at 4.1% at the end of 2026 and 4.1% at the end of 2027, then 3.9% at the end of 2028, which is still inside today's range. In June, those same medians were 3.8%, 3.6% and 3.4%. Sixteen of the 18 placed the end-2026 rate above where it is now.

The minutes, released October 7, say “all participants supported raising the target range,” and include the view that another increase “would likely be appropriate by year end.” They also address housing directly: “housing was a sector in which financial conditions did not appear supportive of activity,” and “borrowing for home purchases remained depressed.” One more line explains why buyers feel this more than the headline suggests: “Residential mortgage rates increased a bit more than 10-year Treasury yields.”

Buyers, sellers and condo associations

• Buyers. The Fed does not set mortgage rates directly, but its own minutes say mortgage rates rose a bit more than 10-year Treasury yields. Freddie Mac's 30-year average was 7.40% on October 8, against 6.30% a year earlier.
• Sellers. With home-purchase borrowing “depressed,” in the minutes' word, the buyer pool leans further toward cash. Cash was 37.8% of Miami closed sales in August, per MIAMI REALTORS. Miami-Dade single-family supply is 4.9 months, still a seller's market. Condos sit at 12.1 months, a buyer's market.
• Condo associations. A board weighing a loan for repairs instead of one large special assessment should know the Fed's median projection does not put its benchmark rate below today's range at any point through the end of 2028. Loan terms depend on the lender, so get quotes now and compare them with the cost of an assessment.

My read

I would plan as if rates stay where they are. The Fed's projections lean that way, and its minutes name housing as a sector where conditions were not supportive. For buyers, that means qualifying at today's rate, not the rate you hope to refinance into later. For sellers, especially condo sellers facing a year of supply, it means pricing for the buyer who exists now. For condo boards, the financing decision on repairs deserves a rate quote this quarter, not next year. None of this is a prediction about prices. Deals still close in this market. The financed buyer simply has less room than in the summer, and everyone on the other side of the table should price that in.