It’s the best time to buy a US home since mid-September, as mortgage rates fall and sellers drop prices, per Redfin

Mortgage rates have experienced a rapid decline, plummeting from a two-decade high of 8% to 7.4% in the past three weeks, providing potential homebuyers with a chance to secure a lower rate, as reported by Redfin, the technology-driven real estate brokerage.

Several macroeconomic factors contributed to the recent rate decrease: the Federal Reserve's decision against another interest-rate hike, the Treasury's announcement of issuing less long-term debt than anticipated, and slower-than-expected growth in the job market.

Redfin economists suggest that serious homebuyers should contemplate locking in a mortgage rate at the current levels, which are the lowest since mid-September. While the downward trend may persist, there is also the possibility of an upcoming increase. Economic developments this month, such as the November 14 Consumer Price Index (CPI) report revealing higher-than-expected inflation, could potentially reverse the current trend.

Despite rates being more than double the levels seen during the pandemic, the shift from 8% to 7.4% results in a reduction of several hundred dollars in monthly mortgage payments in many regions. For instance, a homebuyer in Seattle would pay $4,984 per month for a median-priced home ($775,000) with a 7.4% mortgage rate, compared to $5,240 with an 8% rate.

Seattle Redfin Premier agent Hal Bennett advises buyers to seize the opportunity and lock in a mortgage rate when it becomes favorable, emphasizing the potential for significant overnight increases in payments if rates shift unexpectedly. This window of opportunity may be brief, and buyers have already taken notice, with mortgage-purchase applications experiencing a 3% week-over-week increase.