Lower mortgage rates aren’t igniting the housing market and there are two key reasons why, claims a top economist

Diane Swonk, chief economist and managing director at KPMG LLP, during a panel on the outlook of the US election during the National Association of Business Economics (NABE) economic policy conference in Washington, DC, US, on Wednesday, Feb. 14, 2024. The theme of this year's annual meeting is "Navigating Geopolitical Turbulence and Domestic Uncertainty." Photographer: Graeme Sloan/Bloomberg via Getty Images (Credit: Graeme Sloan/Bloomberg via Getty Images)

Anyone who wants to buy a home wants a low mortgage rate. Well, mortgage rates are falling, and yet people aren’t rushing the market. 

The average 30-year fixed mortgage rate is at its lowest since February last year, and before that, it’d been dropping on the back of positive economic signs. Still, we’re sinking closer and closer to that pivotal magic number the industry loves to say will trigger a wave of movement—we’re at a 6.2% mortgage rate, and according to the real estate lifers, we need to be at 6% or lower.