DES MOINES, Iowa – The Federal Reserve stepped up the fight against inflation Wednesday by boosting the interest rate by the largest amount in 28 years.

Local realtor York Taenzer says the increase puts buyers and sellers in a tough spot. He said the announcement will have people wanting to close the deal sooner.

“Folks that are looking for houses, they’re going to want to make an offer quickly so they can lock in their interest rates,” Taenzer explained. “And that’s what’s key. If they wait for another week or two, interest rates could go up another point.”

With interest rates going up, Taenzer says demand is going to go down, which will impact both buyers and sellers. 

Sellers’ houses will spend more time on the market. Buyers will have to spend more money per month on mortgage payments. Based on the math, Taenzer says people won’t be able to buy as much square feet in a house like they used to be able to.

“If you’re looking at a mortgage on a $200,000 house right now as compared to what it was a year ago, if you’re credit’s average and that kind of stuff it’s about 400 bucks more a month,” Taenzer said.

With interest rates going up and demand going down, Taenzer thinks prices will start to eventually level out.