Falling Mortgage Rates Are Bringing Buyers Back: Is It Time to Sell Your Home?

If you've been holding off on selling your home because of concerns about buyer interest, now might be the perfect time to reconsider. Recent shifts in the economic landscape have started to bring buyers back into the market, and falling mortgage rates are a key driver of this renewed activity.

What’s Happening with Mortgage Rates?

After months of high mortgage rates that kept many buyers on the sidelines, the tide is starting to turn. Due to various economic factors, mortgage rates are already beginning to drop. Just recently, the Federal Reserve cut the Federal Funds Rate for the first time since they started raising it in March 2022. While the Fed doesn’t directly control mortgage rates, this move sets the stage for rates to fall even further—especially with additional cuts expected into next year.

Lower mortgage rates are already bringing more buyers back into the market. As Lisa Sturtevant, Chief Economist at Bright MLS, explains:

“A drop in the cost of borrowing will help fuel more homebuyer demand . . . Falling rates will also bring more sellers into the market.”

Buyer Activity Is on the Rise

As mortgage rates decline, buyer activity tends to increase. The graph below illustrates this relationship, showing how a decrease in the average 30-year fixed mortgage rate (orange line) correlates with a rise in the Mortgage Bankers Association (MBA) Mortgage Application Index (blue line), which tracks the number of mortgage applications.

This trend indicates that as rates fall, more potential buyers are re-engaging in the home-buying process.

What Does This Mean for Home Sellers?

According to the National Association of Realtors (NAR), home sales saw an uptick in July after four consecutive months of decline. This increase in buyer activity is promising news for homeowners considering selling.

More buyers in the market can lead to increased competition, which often results in higher offers and shorter time on the market for your property. Edward Seiler, AVP of Housing Economics at the MBA, adds:

“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.”

This means the market is becoming more accessible to a broader range of buyers, potentially leading to even more interest in homes like yours.

Read the latest insights from the National Association of Realtors

Get Ready to Sell

With more buyers entering the market, now is the ideal time to start preparing your home for sale. Increased buyer demand can work in your favor, leading to a quicker and more profitable sale.

Bottom Line

The recent decline in mortgage rates is already attracting more buyers, and experts expect this trend to continue. If you're considering selling, now is the time to connect with a local real estate agent who can help you capitalize on this increased demand.

Contact me to get started.