I'm not sure this is always good advice.
For many things (like housing), there's an inverse relationship between cost to borrow and price, as people can only afford to pay so much on the monthly payment. So when rates are higher, prices come down, and vice versa (again, look at the housing market as a perfect example).
If someone buys when rates are high, they lock in the low price. And they can pass less in interest by making extra principal payments, or refinancing if rates ever go down. However, if you lock in the high price (with low rates), there's really nothing you can do to improve the financial outcome.
Carrying these points further.....
For the past two years in Middle Tennessee, real estate prices increased at an unprecedented rate as people rushed to buy whatever came on the market due to mortgage interest rates being under 3% for months .... then under 5%. Brokers would list on Friday, have open houses on Sunday and sort through the highest and best offers on Monday with bids significantly over list price.
When the Fed started raising rates, the bidding over list started to be reduced about June and houses are taking weeks instead of days to sell. Asking prices are still at elevated levels even though the 30 year mortgage rate has been over 7% recently. (7.20% this morning).
Although inventory levels have increased somewhat, there appears to be a reluctance to list for sale because many have figured out that their new mortgage payment on a replacement home equivalent to what they already own would double at the inflated price of homes today along with the higher mortgage interest rates, insurance costs, and property taxes not to mention the cost of everything else that eats up household budgets.
It's fairly obvious from Jerome Powell's comments and the increases in the Fed rate that they are attempting to somewhat reset the housing market that they blew up in the first place by lowering rates that much to begin with. Between price increases and interest rate increases, home affordability is at its worst since about 2007 thanks to the Fed. In addition, real estate listing activity has been frozen because people who locked in mortgages at these artificially low 3-5% rates aren't going to refi at higher rates or list their homes for sale when their new mortgage payment on a replacement home would double.
Although the Fed is attempting to partly undo what it caused in the first place, it remains to be seen if listing activity will unfreeze or whether people who locked in these 3-5% rates will just sit tight for the next 30 years or until an unforeseen job loss or death will result in their home being listed for sale.
The worst of all worlds for potential homebuyers would be a real estate market in which listings are few because of these 3-5% mortgage rates for those that have them, high prices because of few listings, and high interest rates because the Fed finally figured out printing too much money too fast causes inflation that they now have to fight by raising rates.
