The housing world is frozen in a state of trapped homeowners who don’t want to sell and reduced affordability partly because of high borrowing costs. But there could be a spring thaw in September that might help melt the market.
It’s a magic number for mortgage rates. And given Federal Reserve Chair Jerome Powell’s dovish tone on Friday, lending costs are poised to drop, clearing the way for lower costs on a home loan. There’s somewhat of a consensus that once mortgage rates dip to 6% or less, it will be irresistible to those who have been biding their time. Earlier this year, self-made real estate millionaire and Shark Tank star Barbara Corcoran said 6% seems to be the “magic number” that will bring sidelined buyers back in. Robert Reffkin, cofounder and chief executive of realty giant Compass, in June said, “I think 6.5% I’d feel good about…but the magic number is 5.9999.” He continued, “That’d be marketing magic, and would tell the world that mortgage rates are at a level where they should go and grab a property.”
