What lower mortgage rates mean for D.C.
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Those golden handcuffs aren't coming loose yet.
Why it matters: Easing mortgage rates offer house hunters some relief. But experts say it's going to take a bigger drop to revive the sluggish home market.
- Rates need to move closer to 5% to bring those reluctant buyers and sellers off the sidelines, D.C. agent Avi Adler tells Axios.
What they're saying: "In 'my day,' you could buy a home that was three to five times your annual salary. You could stay in that 30% range for all housing costs," says DMV Compass agent Connie Carter. That's not the case today, especially in an urban market like Washington.
- This environment is hardest on first-time buyers.
Yes, but: Cash buyers are less sensitive to rates.
The latest: Mortgage rates are hovering around 6%, and analysts don't expect them to fall much further after last week's interest rate cut.
- Realtor.com chief economist Danielle Hale tells Axios she isn't expecting them to dip below 6% this year.
The bottom line: Record U.S. home prices and low inventory continue to sideline many shoppers. Plus, homeowners remain reluctant to give up their less expensive mortgages.
- Nearly 86% of U.S. mortgage holders have a rate under 6%, per Redfin.