What Mortgage Rate Are You Waiting For?

You won’t find anyone arguing that mortgage rates haven’t had a big impact on housing affordability over the past couple of years.

But there’s finally some hope on the horizon.

Rates have actually started to come down, and recently, they hit the lowest point we’ve seen in 2024, according to Freddie Mac (see graph below):

If you’re thinking about buying a home, you might be wondering: how much lower are rates going to go? Honestly, I wouldn't wait if you don't have to.

That said, let’s dive into what the experts are saying and how you can leverage this information to make the right move.

Expert Projections for Mortgage Rates

Experts agree that the overall downward trend in mortgage rates is likely to continue—assuming inflation and the broader economy keep cooling. However, it's crucial to understand that we’re not looking at a straight path downward. As new economic reports come out, we can expect some volatility.

Remember, the big guys on wall street know that volatility equals opportunity - and the same is true in the real estate market. The important thing is not to let those momentary fluctuations distract you from the larger trend.

Here’s the reality: rates are already down roughly a full percentage point from the recent peak back in May. That’s significant, especially when you consider how much more home you can afford with even a slight drop in rates.

The general consensus is that rates in the low 6s are possible in the coming months, depending on economic conditions and the Federal Reserve's next moves. Most experts are now revising their 2024 mortgage rate forecasts to be more optimistic. For instance, Realtor.com recently noted:

“Mortgage rates have been revised slightly lower as signals from the economy suggest that it will be appropriate for the Fed to begin to cut its Federal Funds rate in 2024. Our yearly mortgage rate average forecast is down to 6.7%, and we revised our year-end forecast to 6.3% from 6.5%.”

This is crucial information for anyone who has been sitting on the sidelines, waiting for the "perfect" time to jump into the market.

Know Your Number for Mortgage Rates

So, what does all this mean for your plans to move?

If you’ve been holding out, waiting for rates to drop, it’s time to recognize that it’s already happening. The key now is to determine what rate works for you. Ask yourself this: What number do I want to see before I’m ready to make my move?

Maybe it’s 6.25%, maybe it’s 6.0%, or maybe you’re waiting for rates to hit that magic 5.99%. The exact percentage where you feel comfortable jumping back into the market is a personal decision. But here’s the thing—you don’t have to keep watching the market like a hawk, waiting for that number to appear.

Instead, connect with a seasoned real estate professional who can monitor the market for you and guide you on when to take action. As Sam Khater, Chief Economist at Freddie Mac, explains:

“The decline in mortgage rates does increase prospective homebuyers’ purchasing power and should begin to pique their interest in making a move.”

This is where working with an expert really pays off. When you have a clear number in mind, a good real estate professional will be on the lookout for you and alert you the moment conditions align with your goals.

But Don’t Forget the Bigger Picture

One thing to keep in mind: while it’s tempting to wait for the lowest possible rate, don’t let the pursuit of perfection paralyze you. The Seattle market, like many others, has a chronic shortage of homes, with high demand and limited inventory driving competition. Every time rates drop, more buyers flood the market, intensifying competition.

If you wait too long, you might miss out on the ideal home, even if the rate hits your target. Sometimes, acting when the rate is "good enough" rather than "perfect" can actually be the smarter move. After all, you can always refinance later if rates drop further.

Bottom Line

If you’ve put your plans on hold due to higher mortgage rates, it’s time to think about the number that would make you feel confident in re-entering the market. Once you’ve got that number in mind, connect with a real estate professional - someone you like, and trust ... maybe even me... who can keep an eye on the market for you and let you know when it’s time to act.

In a competitive market like Seattle, having a strategy and a trusted expert by your side can make all the difference. Don’t miss out on the opportunities that are already starting to unfold—let’s work together to find the right time to make your move.

If you're making a move, reach out, and lets chat. Happy to brainstorm and come up with a solution that gets you a tangible and actionable plan that fits your unique situation.

Best,

Justin H Gazabat
Broker | PNW, Seattle, Ballard, East Side
Your Friendly Seattle Neighborhood Real Estate Professional.
www.JustinGazabat.com

PS: If anyone in your social or work circles considering a move, just send Me an intro text or email with their best contact info, make sure everyone is CC’d and I’ll take care of the rest! I promise to take great care of them, serve them well, make you look good, plus help them get great results.

*Information from our friends at Freddie Mac, Sam Khater, Chief Economist at Freddie Mac, realtor.com, Keeping Current Matters, et al.