Mortgage Rates Just Saw Their Biggest Drop in a Year

 

 

You’ve been waiting for what feels like forever for mortgage rates to finally budge. And last week, they did – in a big way.

 

On Friday, September 5^th, the average 30-year fixed mortgage rate fell to the lowest level since October 2024. It was the biggest one-day decline in over a year.

 

What Sparked the Drop?

According to Mortgage News Daily, this was a reaction to the August jobs report, which came out weaker-than-expected for a second month in a row. That sent signals across the financial markets, and then mortgage rates came down as a result.

 

Basically, we're seeing signs the economy may be slowing down, and as certainty grows in the direction the economy is going, the markets are reacting to what is likely ahead. That historically brings mortgage rates down.

 

Why Buyers Should Pay Attention Now

But this isn’t just about one day of headlines or one report. It’s about what the drop means for you.

 

This recent change saves you money when you buy a home. The chart below shows you an example of what a monthly mortgage payment (principal and interest) would be at 7% (where mortgage rates were in May) versus where rates roughly are now:

 

Compared to just 4 months ago, your future monthly payment would be almost $200 less per month. That’s close to $2,400 a year in savings.

 

How Long Will It Last?

That really depends on where the economy and inflation go from here. Rates could drop lower, or they could inch up slightly. 

 

So, make sure you’re connected with a good agent and trusted lender. They’ll keep a close eye on inflation indicators, job market updates, and reactions to upcoming Fed policy to gauge where mortgage rates may go from here.

 

But for now, focus on this. While no one can say for sure where rates are headed, the fact that rates broke out of their months-long rut is a good thing. If you’ve been feeling stuck, this could make the start of a new chapter. As Diana Olick, Senior Real Estate and Climate Correspondent at CNBC, says:

 

“Rates are finally breaking out of the high 6% range, where they’ve been stuck for months.” 

 

And that’s gives you more reason to hope than you've had in quite some time.

 

Bottom Line

This is the shift you’ve been waiting for.

 

Mortgage rates just saw their biggest decline in over a year. And if rates stay near this level, it could make a home you couldn’t afford just a few months ago feel possible again.  What would today’s rates save you on your future monthly payment? Let’s connect so you can find out.

Today’s Tale of Two Housing Markets Summer 2025

 Today’s Tale of Two Housing Markets

 

Depending on where you live, the housing market could feel red-hot or strangely quiet right now. The truth is that local markets are starting to move in different directions. In some places, buyers are calling the shots. In others, sellers still hold the power. It’s a tale of two markets.

 

What’s a Buyer’s Market vs. a Seller’s Market?

In a buyer’s market, there are more homes for sale and not as many buyers. That means homes sit longer, buyers have more negotiating power, and prices tend to soften as a result. It’s simple supply and demand.

 

On the flip side, a seller’s market happens when there aren’t enough homes available for the number of people looking to buy them. Because buyers have to compete with each other to get the house they want, that leads to faster sales, multiple offers, and rising prices.

 

Right now, both of these scenarios are playing out, depending on where you are. So, how do you know what kind of market you’re in? Lean on a local real estate agent. They’ll explain what’s really happening in your area based on these key drivers.

 

The Number of Buyers and Sellers by Region

One of the biggest factors impacting each market is the number of active buyers and sellers. According to Redfin, here’s what that looks like by region (see graph below):

 

Today, the Northeast and Midwest are more likely to be seller’s markets. Buyers still outnumber sellers there, and that keeps things tilted in favor of homeowners. Generally speaking, homes are selling faster and prices are rising in those areas.

But the South and West are leaning more toward buyer’s markets. There are more sellers than buyers, which means more listings to choose from and less competition among buyers.

 

That’s a major shift from a few years ago when sellers had the advantage almost everywhere. Today, your local conditions matter more than ever – and they can vary even from one neighborhood to the next.

 

Price Trends Mirror the Buyer/Seller Divide

When inventory and buyer activity shift, so do prices. In places where demand still outpaces supply, like much of the Northeast and Midwest, prices are continuing to climb.

 

But in parts of the South and West where inventory is up and demand has cooled, prices are softening. And that’s a plus for buyers looking to negotiate in those areas.

 

Here’s the latest price data from ResiClub to show how this divide is shaking out across the top metros in the country (see graph below):

 

This is why it’s the tale of two markets. Roughly half of the top 50 metros are up, and half are relatively flat or down.

 

That said, don’t panic if you own a home in a market where prices are dipping. Most homeowners have built up significant equity over the past few years, and chances are you have too. So, you’re likely still come out way ahead when you sell.

 

Why Local Insights Matter

Even in regions that lean more buyer-friendly right now, there will be cities, towns, and even neighborhoods that don’t follow the regional trends. That’s why a Coldwell Banker Realty agent’s local market expertise is so important. They can help you understand what’s happening all the way down to a zip code level, including:

 

• Whether your area is favoring buyers or sellers
• How to set the right price or craft an offer strategy based on local trends
• The best way to make your move happen, no matter what’s happening in the market

 

Bottom Line

In a market where conditions vary this much from place to place, success starts with understanding every aspect of your local area. Let’s connect so you’ve got an expert in your corner who knows exactly how to guide you through your market, wherever you are.

The Great News for Home and Property Owners!

 

📈 While property values are expected to appreciate over the next five years, rising prices are just one advantage of homeownership or holding real estate.

💰 Owners may also benefit financially through tax deductions—such as depreciation and mortgage interest—which can reduce taxable income.

🏡 Additionally, as principal payments are made on financed properties, equity grows by steadily decreasing the outstanding loan balance.

A Tale of Two Markets

What Buyers and Sellers Need to Know This Spring

By Margaret Heidenry

April 21, 2025

Home shoppers entering the market might find themselves in a head-scratching situation this spring. In one neighborhood, listings may vanish in a flash—often above asking price.

Just a few miles over? Crickets.

Recent economic uncertainty is also likely to affect the housing market, leading to some surprises.

“The current real estate market is definitely one of confliction,” said Cara Ameer, a real estate agent with Coldwell Banker who operates in California and Florida. “You may have homes that have multiple offers and others that are sitting. A lot of this depends on what type of home it is, where it is, and what it has or does not have.”

Whether you’re buying or selling this season, success may come down to reading your local market—and adjusting your strategy accordingly.

More homes on the market

Much of the see-sawing in the housing market comes from a spike in housing stock.

The number of homes for sale shot up 28.5% in March compared to the same time last year, according to the latest data from Realtor.com’s March housing report. That’s the 17th month in a row of year-over-year growth in the number of homes on the market.

New home listings also jumped by 10.2%—marking the busiest March in three years.

An uptick in listings mean some buyers have more room to negotiate and may not need to rush into an offer unless their local market is heating up. Instead, they can tour a variety of homes and take time to compare them.

Home shoppers looking for an edge can get pre-approved early and lock in their rate if they can. They should also run the numbers—not just on the home price but also on the monthly payment, taxes, and insurance.

Price cuts are back

Some sellers hoping for a bidding war over their home may be in for a surprise.

The national median list price held firm at $424,900 in March, according to Realtor.com, which is flat year-over-year. In other words, there’s no surge, no crash, just a market treading water.

However, nationally, nearly one in five homes, 17.5%, saw a price reduction in March, the highest level for that month since at least 2016. That may signal sellers are feeling the pressure of increased housing stock and overall competition.

Volatility in the stock market may lead to additional price cuts in certain markets. Buyers who were planning to take money out of their investments to use for to purchase homes may have less money to spend.

Translation: Sellers may not be in the driver’s seat anymore. But there is a way to make your home stand out.

“Make your home move-in ready,” said Samantha Sousa, a real estate broker in Visalia, Calif. “Add fresh paint, curb appeal, and get your real estate agent to write a thorough listing description.”

Where the market’s still hot

Not every market is cooling its heels, and some metros are downright sizzling.

Only 7% of listings in New York City saw price cuts in March, according to Realtor.com. In Hartford, Connecticut, the situation is even tighter, with 5.5% of the listings seeing price reductions.

These markets are seeing the flip side of the housing market coin because they have in-demand job markets and tighter housing stock. There also isn’t as much new construction in these areas due to a lack of land to build on.

A pent-up desire from buyers after years of waiting on the sidelines may also be fueling these markets.

It’s not unusual to see bidding wars, offers above list price, and quick closings in hot areas.

Despite a fast-moving market, sellers should resist the temptation to list their homes well above other homes in the neighborhood. Especially at a time of economic uncertainty, a well-priced home will draw more buyers and could spark a bidding war. Meanwhile, a too-high list price may result in few, if any, offers.

“There’s a saying the home may be priced right but not priced right for this market,” said Ameer. “You have to work with the pricing to find the sweet spot that will motivate buyers to act. That is usually lower than what a seller expected.”

Where the market’s cooling down

On the flip side, some once-scorching markets are now firmly in the “cooling” category.

In Phoenix, Ariz., 32% of homes saw a price reduction in March, according to Realtor.com. Austin, Texas, wasn’t far behind at 22%. These metros that saw breakneck price gains in the COVID-19 pandemic years are now catching their breath.

Local job market slowdowns, buyers hitting the tops of their budgets and beyond, and an influx of listings play a role in the sluggish pace. These are also areas where there often tends to be more new construction.

In some places, buyers are firmly back in control, with more homes to choose from translating to leverage at the negotiating table.

“Buyers may be able to submit offers lower than asking for homes that have been sitting,” said Sousa. “They have more control over the market than in previous years, so they can write an offer that makes sense for them. This spring, we should see an influx of listings, so be patient and find a home that works for you rather than rushing.”

How sellers can stay competitive

Whether you’re in a hot ZIP Code or a cooler corner of the U.S., anyone looking to put a home on the market this spring may need to adapt.

In softer markets, it’s about patience, flexibility, and presentation.

For example, sellers are not just turning to price reductions. Concessions are also making a comeback—think sellers helping with closing costs, adding home warranties, or even allowances for cosmetic updates.

Sellers can talk to their agent about what’s motivating buyers in your area.

For homeowners in hotter metros, the strategy may be simpler: Price it right and prepare for a fast sale.

“The price needs to be close to appraised value, so an accurate neighborhood sales evaluation is crucial,” said Sousa.

If you would like to have your property valued, reach out today!

Twin Cities Weekly Market Activity Report - Week Ending February 1

 

At The Basil Group, we're celebrating our 27th years at your #1 Twin Cities Real Estate Brokerage!

All data from NorthstarMLS. Provided by Minneapolis Area REALTORS®.

 

U.S. sales of existing homes totaled 4.06 million in 2024, down from 4.09 million the year before, according to the National Association of REALTORS®. Meanwhile, sales of new single-family homes grew for the second year in a row, with an estimated 683,000 units sold last year, a 2.5% increase from 2023, the U.S. Census Bureau reports.

It looks like 2025 will be another impressive year for buying and selling Real Estate!

 

In the Twin Cities region, for the week ending February 1:

• New Listings increased 4.5% to 1,029
• Pending Sales decreased 6.7% to 687
• Inventory decreased 1.9% to 6,844

 

For the month of December:

• Median Sales Price increased 4.6% to $370,000
• Days on Market increased 9.8% to 56
• Percent of Original List Price Received increased 0.3% to 97.0%
• Months’ Supply of Homes For Sale remained flat at 1.9