November 7, 2024
The Federal Reserve’s recent half-point rate cut affects both buyers and sellers. While the Fed doesn’t directly set mortgage rates, its actions influence them by pushing down other interest rates. However, broader economic factors also play a role in shaping mortgage rates. Here's what to expect:
If you're considering buying a home, experts suggest acting now. The 30-year fixed mortgage rate is below 6.5%, down from over 7.6% last year. Jessica Lautz, NAR’s deputy chief economist, says expected rate cuts are likely factored into current rates. Buyers can also refinance if rates drop further.
Even a 1% rate reduction can save buyers thousands on a mortgage. Lower rates mean reduced interest costs, smaller monthly payments, and easier loan approvals.
Falling rates often bring increased buyer activity. Lower borrowing costs boost purchasing power, drawing more buyers into the market—especially in areas with tight inventory. This increased demand can drive up home prices, making it an ideal time for sellers to list their homes.
The fall market usually slows, and sellers may feel pressure to lower prices as buyers await better rates. Pricing your home right from the start is essential. Recent NAR changes have complicated negotiations, particularly around buyer’s agent compensation. Sellers should be ready for unique offers and flexible discussions to close deals and secure the best offers.
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Jessica loves being a real estate broker, or as she puts it, the “captain of your team” and advocate who has your best interests at heart when helping you buy or sell a home.