Lowering Mortgage Rates Brings Renewed Hopes for Struggling Property Sales
The U.S. housing market, which has been struggling with high mortgage rates and limited supply, might be seeing a glimmer of hope, according to financial planner Richard Rosso.
In a recent statement, Rosso compared the current real estate market to a "giant frozen glacier" that is starting to melt. The average 30-year mortgage rate has shown signs of softening, dipping to its lowest level in four months, currently at 6.62 percent.
However, these rates remain elevated compared to pandemic lows, hovering around 6.5 to 7 percent in 2025, significantly higher than the historic lows near 2.65 percent during early 2021. Despite Fed rate cuts and expectations for mortgage rates to drop substantially, rates have remained stubbornly high, only dipping slightly to about 6.5 percent recently.
These high rates have contributed to a sustained sales slump in the U.S. housing market since early 2022, with home sales hitting a near 30-year low last year and continuing sluggishly this year. According to Rosso, while the gradual rate decline offers some hope, the path to more affordable home financing is slow.
Moreover, supply shortages—such as a lack of downsizing by baby boomers and limited new home construction—are key constraints restraining market recovery despite any rate improvements. The combined effect keeps pressure on affordability, limiting increases in home sales even as mortgage rates show signs of slightly softening.
Despite the challenges, Rosso encourages potential buyers to resume their home search, stating that the current mortgage rate offers some relief for potential buyers. He also suggests that new home buyers could have an opportunity in the current market. However, he emphasizes that the current mortgage rate improvement is not a game changer for the overall housing market.
In summary, lower 30-year mortgage rates, if sustained, could positively impact the U.S. housing market by making borrowing more accessible. Yet, persistent supply constraints and relatively elevated rate levels temper a large-scale rebound in home sales for now. The current real estate market continues to present challenges, as stated by Richard Rosso, but there are signs of warming up on the horizon.
- Richard Rosso suggests that new home buyers might find an opportunity in the current real-estate market, given the recent decline in the average 30-year mortgage rate.
- Despite the gradual decline in mortgage rates, Rosso notes that the current market remains challenging due to persistent supply shortages and rates that are still higher compared to historic lows.
