Mortgage rates have been a major topic in the housing market due to their significant impact on affordability. If you're looking to buy a home, you've likely been waiting for rates to drop. Good news: the past few weeks have shown a promising decline in rates.

Mortgage Rates Trend Down in Recent Weeks

There's exciting news about mortgage rates. Following recent reports on the economy, inflation, unemployment rates, and comments from the Federal Reserve, mortgage rates have started to decrease. According to Freddie Mac, rates are now at their lowest level since February. Here's a visual representation of this downward trend:

You might be tempted to wait and see if rates will drop even further. However, it's important to keep things in perspective. The record-low rates from the pandemic are a thing of the past. If you're hoping for a 3% mortgage rate again, experts agree that’s unlikely. As Greg McBride, Chief Financial Analyst at Bankrate, explains:

"The hopes for lower interest rates need the reality check that 'lower' doesn't mean we're going back to 3% mortgage rates. . . the best we may be able to hope for over the next year is 5.5 to 6%."

With the recent decrease in rates, you have a great opportunity right now. This might be the moment to jump back into the market.

The Relationship Between Rates and Demand

If you wait for mortgage rates to drop further, you might face increased competition as more buyers restart their home searches.

Typically, when mortgage rates are high, buyer demand is low. But as rates begin to fall, the situation changes. Buyers who were hesitant due to higher rates will resume their searches. This could lead to increased competition. As a recent article from Bankrate notes:

"If you’re ready to buy, now might be the time to strike. Home prices have been rising primarily because of a longstanding shortage of homes for sale. That’s unlikely to change, and if mortgage rates do fall below 6%, it’s possible buyers would enter the market en masse, further pushing up prices and resurrecting bidding wars."

Bottom Line

If you've been waiting to make your move, the recent downward trend in mortgage rates could be the sign you've been looking for. Rates are at their lowest point in months, giving you the chance to act before other buyers flood the market.

If you’re ready and able to start the process, reach out and let’s get started.