Last week, Redfin published a new report that shows now is — relatively speaking — a good time to buy a home. The fly in the ointment remains elevated mortgage rates.
Still, for those prepared to make lifestyle sacrifices to afford those higher mortgage payments, the housing market presents a nearly irresistible scenario, especially for first-time buyers. Redfin says:
- Fresh listings are hitting the market in numbers unseen since 2022
- Supply is exceeding demand — Most places are "buyers' markets," meaning buyers have more negotiating power than sellers
- List prices are inching down
Of course, none of these apply everywhere. And there are still real estate hotspots where sellers have the upper hand. Indeed, one-in-four (25.9%) of homes sold over the four weeks ending August 30 went for more than their list prices.
Still, on average nationwide, it's been a long time since the housing market has looked so enticing for homebuyers.
Some Details
Here are some detailed data from Redfin that illustrate how housing market trends have moved over the year ending Aug. 30:
- Mortgage-purchase applications (seasonally adjusted) — down 0.2% from a year earlier
- Google searches of "homes for sale" — down 6%
- Median asking price (seasonally adjusted) — down 0.1%
- New listings (seasonally adjusted) — up 8%
- Active listings (seasonally adjusted) — up 2.4%
Redfin states that the median sale price rose by 2.2% between Aug. 30, 2025 and Aug. 30, 2026. That sounds less good, but overall prices for all goods and services rose 3.7% during the year ending July 31, 2026, according to the latest PCE price index (the Federal Reserve's favorite inflation gauge), so homes are less costly in real terms.
Better yet, last week's jobs report (aka the employment situation report) showed average hourly earnings rising by 3.1% over the year ending in August 2026. If the median sale price of homes rose 2.2% over that same period, those home prices are becoming more affordable.
The Mortgage Rate Problem
Of course, one can't just ignore the elephant in the room: mortgage rates.
Back on Feb. 26, the weekly average for a 30-year fixed-rate mortgage was 5.98%, according to Freddie Mac. And those rates were on a gentle downward trend.
If they'd stayed put or continued to fall, we wouldn't need to have this conversation now. But the Iran conflict began three days after that recent low's appearance, and since then mortgage rates have been on a mostly upward trend.
That's no surprise. Mortgage rates are very sensitive to inflation trends, and the dispute with Iran has pushed the inflation rate much higher, as gas, diesel and many other prices have climbed.
Still, things may not be as scary as some seem to think. On Sep. 3, 2025, that same rate stood at 6.50%, says Freddie. Last week, on Sep. 3, 2026, that rate was 6.71%.
That's a 21-basis-point (a basis point is one-hundredth of 1%) difference, which isn't nothing. But it's also not a huge change.
We've seen bigger rises and falls in a single day, though admittedly not often or recently.
Should Buyers Wait for Lower Rates?
Nobody knows what will happen to mortgage rates in the future. But few experts who monitor mortgage rates for a living are forecasting a significant fall anytime soon.
If there's a consensus, it's that they'll stay within 20 basis points of where they currently are through 2027, and possibly into 2028. So, waiting to buy a home until mortgage rates dip below 6% again could turn out to be a very long-term strategy.
Indeed, such a fall could be many years away. "Since Freddie Mac began tracking rates in April 1971, the median 30-year mortgage rate is 7.23%," reported U.S. News in July. So, there's no guarantee that the next big trend will be downward.
As importantly, the next time mortgage rates are perceived to be a bargain, all the pent-up demand from wannabe home buyers who have been waiting for such an event will likely be unleashed. And that could almost instantly turn virtually every local market into a sellers' market, meaning only buyers who time their purchase perfectly will enjoy the sorts of benefits Redfin outlined in its report.
Perfect times to buy a home have similar life expectancies to the American sand-burrowing mayfly: Females live for only 5 minutes and males live for at most 1 hour as adults. One has to be lucky to notice one before it's gone.
Readers who can't afford current mortgage rates must wait until those rates or their incomes improve. Those who are waiting to buy because they'd like a lower rate might wish to reconsider. They can always refinance if rates do fall significantly. But holding off will likely have costs of its own.
