Mountain Rose Realty — Telluride, Colorado
Lower Mortgage Rates Are Bringing Buyers Back to the Market — featured image

Lower Mortgage Rates Are Bringing Buyers Back to the Market

By 2 min read
Buying a Home

Lower Mortgage Rates Are Bringing Buyers Back to the Market | MyKCM

As mortgage rates rose last year, activity in the housing market slowed down. And as a result, homes started seeing fewer offers and stayed on the market longer. That meant some homeowners decided to press pause on selling.

Now, however, rates are beginning to come down—and buyers are starting to reenter the market. In fact, the latest data from the Mortgage Bankers Association (MBA) shows mortgage applications increased last week by 7% compared to the week before.

So, if you’ve been planning to sell your house but you’re unsure if there will be anyone to buy it, this shift in the market could be your chance. Here’s what experts are saying about buyers returning to the market as we approach spring.

Mike Fratantoni, SVP and Chief Economist, MBA:

“Mortgage rates are now at their lowest level since September 2022, and about a percentage point below the peak mortgage rate last fall. As we enter the beginning of the spring buying season, lower mortgage rates and more homes on the market will help affordability for first-time homebuyers.”

Lawrence Yun, Chief Economist, National Association of Realtors (NAR):

“The upcoming months should see a return of buyers, as mortgage rates appear to have already peaked and have been coming down since mid-November.”

Thomas LaSalvia, Senior Economist, Moody’s Analytics:

“We expect the labor market to remain robust, wages to continue to rise—maybe not at the pace that they did during the pandemic, but that will open up some opportunity for folks to enter homeownership as interest rates stabilize a bit.”

Sam Khater, Chief Economist, Freddie Mac:

“Homebuyers are waiting for rates to decrease more significantly, and when they do, a strong job market and a large demographic tailwind of Millennial renters will provide support to the purchase market.”

Bottom Line

If you’ve been thinking about making a move, now’s the time to get your house ready to sell.  Connect now to Mountain Rose Realty by Anne-Britt so you can learn about buyer demand in our area the best time to put your house on the market.

Frequently Asked Questions

What do recent mortgage rate trends mean for sellers in early 2023?
Mortgage rates have dropped to their lowest level since September 2022 and are about a percentage point below last fall's peak, which is bringing buyers back into the market. This shift creates a strong opportunity for sellers who paused their plans during the high-rate period, as homes will now face more competition from active buyers entering the spring season.
How much did mortgage applications increase according to recent data?
According to the Mortgage Bankers Association, mortgage applications increased 7% compared to the week prior, signaling renewed buyer interest as rates begin to decline.
Which groups of buyers are expected to benefit most as rates stabilize?
First-time homebuyers and Millennial renters are expected to be primary beneficiaries, as lower rates and a strong job market with rising wages will improve affordability and homeownership opportunities for these groups.
When should sellers list their homes to take advantage of this market shift?
Experts recommend preparing your home to sell now, as the spring buying season is approaching and buyers are beginning to return to the market. This is the optimal time to connect with a local real estate advisor like Anne-Britt at Mountain Rose Realty to assess buyer demand in your area and determine the best listing timeline.