If you’ve been reluctant to list your house because you’re concerned about a lack of buyers, this is your sign that it might be time to consult with an agent.
After months of high rates keeping buyers on the sidelines, the situation is beginning to change. Rates are already decreasing due to various economic factors. Just yesterday, the Federal Reserve cut the Federal Funds Rate for the first time since they started increasing it in March 2022. While they don’t directly control mortgage rates, this move sets the stage for mortgage rates to drop even further – especially with more cuts from the Fed anticipated into next year. Lower mortgage rates are drawing more buyers back into the market. Lisa Sturtevant, Chief Economist at Bright MLS, says:
“A drop in the cost of borrowing will help fuel more homebuyer demand . . . Falling rates will also bring more sellers into the market.”
The best part? You can take advantage of that renewed buyer interest.
The graph below illustrates the relationship between falling mortgage rates and rising buyer activity. The orange line represents the average 30-year fixed mortgage rate, while the blue line shows the Mortgage Bankers Association (MBA) Mortgage Application Index, which tracks the number of mortgage applications.
As you can see, as mortgage rates (orange) come down, the Mortgage Application Index (blue) rises, showing more people start to re-engage in the process (see graph below):
According to the National Association of Realtors (NAR), home sales increased in July, which was a welcome shift after four straight months of declines. If you're a homeowner thinking about selling, this uptick in buyer activity works in your favor.
More buyers means more competition, which can lead to higher offers and shorter time on the market for your house. And, according to Edward Seiler, AVP of Housing Economics at the Mortgage Bankers Association (MBA), this trend is expected to continue:
“MBA is expecting that slower home-price appreciation, coupled with lower rates, will ease affordability constraints and lead to increased activity in the housing market.”
All in all, the market is becoming more accessible to a wider range of buyers, which could result in even more people looking to purchase a house like yours.
With more buyers entering the market, now’s the time to start getting your house ready to sell.
The recent drop in mortgage rates is already attracting more buyers to the market, and experts predict this trend will persist. Let's collaborate to capitalize on this growing buyer interest and prepare your house for sale.