Andrea Ballesteros September 19, 2024
If you've been sitting on the fence about listing your home because you're worried no one's buying, now's the moment to act. Recent economic shifts, including lower interest rates, are driving renewed interest among buyers. The Federal Reserve has taken its first step toward cutting the Federal Funds Rate, with more cuts expected in the coming months. While mortgage rates aren't directly controlled by the Fed, this move signals that mortgage rates could drop even further. This change is already reigniting buyer activity, giving homeowners like you a fantastic opportunity to jump into the market.
After months of high rates keeping potential buyers on the sidelines, the tide is turning. Economic factors have contributed to a noticeable dip in mortgage rates, and with yesterday’s Fed decision, we’re likely to see even more favorable rates in the near future. Lower rates mean one thing: buyers are ready to make their move.
Lisa Sturtevant, Chief Economist at Bright MLS, highlights the trend:
“A drop in the cost of borrowing will help fuel more homebuyer demand. . . Falling rates will also bring more sellers into the market.”
This shift isn’t just about buyers; it's also creating a window of opportunity for sellers. More buyers mean more competition for homes, which could drive up offers and reduce the time your house sits on the market.
The graph (shown above) clearly demonstrates the connection between declining mortgage rates and rising buyer activity. The orange line tracks the average 30-year fixed mortgage rate, while the blue line represents the Mortgage Application Index—a key indicator of buyer activity.
As mortgage rates (orange) decrease, the Mortgage Application Index (blue) shows a noticeable increase in activity, especially around September 2024. This pattern suggests that buyers are more inclined to apply for mortgages when rates fall, positioning themselves to enter the housing market. The sharp uptick in mortgage applications in recent months confirms what many in the real estate industry have been waiting for: buyers are back.
According to the National Association of Realtors (NAR), home sales finally increased in July after four consecutive months of declines. This shift in buyer demand means homeowners thinking of selling can capitalize on a busier market. More buyers lead to greater competition for homes, which could result in higher offers, faster transactions, and a smoother overall process.
Edward Seiler, AVP of Housing Economics at the Mortgage Bankers Association (MBA), explains:
“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.”
In essence, homeownership is becoming more accessible to a broader pool of buyers, and this could bring even more prospects to your doorstep.
The recent decline in mortgage rates is a clear signal that more buyers are returning to the market. This influx of activity creates a prime opportunity for you to list your home and take advantage of this surge in demand. Let’s work together to prepare your house, so you can benefit from a wave of interested buyers and secure the best possible deal.
By acting now, you're positioning yourself ahead of the curve. So, if you're ready to make a move, the time to list is now!
Understanding the psychology of color to create the perfect ambiance in your home.
Your Ultimate Guide to Local Events
700 Acacia Avenue, Corona del Mar
650 Glenneyre Street, Laguna Beach
26381 Dapple Grey Drive, Laguna Hills
New Listing with Panoramic Ocean and Coastline Views
Why Now Is the Perfect Time to List Your Home: Falling Mortgage Rates Ignite Buyer Demand
Understanding the Market Trends: Why Prices Are Still Rising, How Supply and Demand Play a Role, and the Importance of Local Expertise
Explore the timeless elegance of Modern Classic style in today's interiors.
We will work tirelessly to ensure you have the best experience whether you are selling your home, looking to purchase an investment property or searching for your forever house. We are here for you and don’t just walk away after closing. We pride ourselves on our long term relationships with our clients and will guide you through all the necessities you need before, during and after your selling or buying experience.