Are Lower Mortgage Rates Enough to Attract U.S. Homebuyers? Here’s the Truth!

Mortgage rates in the United States have recently fallen to their lowest point since February 2023. The average rate for a 30-year fixed mortgage has decreased from 6.35% to 6.2%, prompting discussions about whether this decline could encourage more homebuyers to re-enter the market.

Danielle Hale, Chief Economist at Realtor.com, spoke with Yahoo Finance to explore whether the cooling mortgage rates are sufficient to entice potential buyers. She noted that a significant number of consumers expect mortgage rates to decline further over the next year. “While there are reasons for buyers to consider entering the market now to take advantage of the recent drop in rates, many are still cautious,” Hale remarked.

Hale highlighted that affordability remains a key issue, closely tied to income growth reported in the US labor market. Improved income levels could help potential buyers qualify for mortgages as rates continue to ease. Additionally, she pointed to the proposed tax credit policy for first-time homebuyers by Vice President Kamala Harris as another potential factor that could influence the market.

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