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The typical 30-year fixed mortgage rate currently hovers around 6.5%, and existing home sales in June hit their lowest point in nine months. In June, about one in seven tentative deals fell apart, supported by data from the National Association of Realtors (NAR). Meanwhile, home prices have inched up by 2% compared to last year.
In essence, the real estate market is pretty chaotic at the moment. Prospective homebuyers are left wondering if they’ll ever get a break, particularly through lower interest rates.
Experts assure that relief will come, but now isn’t the time to be too hopeful. Melissa Cohn, regional vice president of William Raveis Mortgage, mentions that mortgage rates will fall below 6% only when inflation gets significantly closer to the Fed’s 2% target.
“A softening economy and a declining job market are also necessary to drive rates down. With new tariffs on the horizon, it could take longer than expected for rates to decrease,” Cohn informed Entrepreneur. “Keep in mind, economic troubles typically lead to favorable rate reductions.”
Projections suggest rates will linger in the mid-6% range for at least the coming few quarters and into 2026. Yahoo Finance reports many experts doubt rates will dip below 6% in 2026, though Fannie Mae’s July Housing Forecast predicts a decrease to about 6% by Q3 2026.
Historically, rates have fallen during economic distress, such as during the Covid pandemic when they plummeted to record lows of 2.65%, or during the Great Depression, highlights Yuval Golan, the founder of the real estate financing platform Waltz.
“Typically, during times of economic challenges, there’s an incentive to stimulate the economy,” Golan tells Entrepreneur. “One way to do this is by lowering interest rates to encourage consumerism — from cars to housing and everything in between.”
So what can home buyers do now? Barbara Corcoran recommends looking at homes that have been on the market a while and shopping in the off-season (in winter, or after the school season has started) — and not waiting.
The best time to buy is always “now,” she says.
The average 30-year fixed mortgage rate is around 6.5% at press time, and June existing home sales fell to a nine-month low. In fact, one in seven potential deals fell through that month, according to data from the National Association of Realtors (NAR). Home prices, meanwhile, are still rising, up 2% from a year ago.
Basically, the real estate market is a mess right now. And house hunters are wondering if they will ever see relief, at least in the form of lower interest rates.
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