Mortgage Rates, Seasonal Timing, and Fixer-Uppers: What Homebuyers Need To Know Now

After the Federal Reserve cut its federal funds rate last week, we’ve heard from several Fed members. Their speeches reinforce a key takeaway from the meeting’s summary of economic projections: There is a wide variety of perspectives at the Fed.

A sizable minority—7 of the 19 participants—expect no further rate cuts this year, and we’ve seen futures markets lower the implied odds of rate cuts in both October and December.

As I anticipated last week, we’ve seen a bit of a bounce-back in mortgage rates, which rose 4 basis points to 6.3%. This is a modest increase. However, combined with a 10-year yield that has edged even higher, it could create a sense of urgency for home shoppers in the market to act before rates move further.

Even as rates tick up, they remained in the low 6% for only the third week so far in 2025. This will likely nudge home sales higher in the months ahead, but the improvement won’t happen overnight nor to the same degree in all areas.

To see where sales could react most to rates, we found markets where large shares of homeowners have a mortgage. Metros in the South and West topped the list, with my hometown—the nation’s capital—and surrounding markets coming in at No. 1.

This week’s housing data shows that last week’s bright spot has faded. The number of newly listed homes actually fell behind the year-ago level, helping to slow active listings growth and increase time on the market even as prices were flat.

Looking back a bit, in August, builders saw new-home sales surge as relatively abundant inventories plus a greater share of move-in-ready new homes helped shoppers take advantage of builder promotions. At the same time, existing-home sales ebbed month to month but notched a second consecutive annual gain as typical sales prices rose. 

Last week, we released the 2025 Best Time To Buy report, which identifies Oct. 12–18, which is still a few weeks away, as the best week of the year to look for a home nationwide. But in a handful of markets, the time is now—and for even more areas, the trends align next week! 

Finally, in addition to tapping into the seasonal sweet spot, those seeking a more affordable way to buy a home might consider rolling up their sleeves. In fact, the Realtor.com® fixer-upper report found that interest in project homes has climbed. The report also identifies top fixer-upper markets for the availability of "bring your imagination" homes and the potential return on sweat equity.