What A Banker Just Told Me About The Housing Market

"it looks like we might be getting lower interest rates in the near future."

"We're all getting ready for the party to start. The housing market has been extremely slow the last few years."

"But now it looks like a lot of bankers and realtors believe that the housing market is about to start booming again"

"And looks like we could be seeing lower interest rates coming soon."

"And the reason why many people are anticipating lower mortgage rates come 2026 is because President Trump wants to replace the chairman of the Federal Reserve Bank, Jerome Powell, with somebody who is going to be much more aggressive on cutting interest rates."

"Now, fast forward to 2025 and we are starting to see a softening in the housing market because we're starting to see more home listings hit the market. We're seeing less buyers and we're seeing more price cuts happen."

"if we start to see them happen soon, that could impact demand, but it could also impact supply."

"So, we could see more demand if interest rates and mortgage rates fall."

"But you can also see something similar happen on the supply side. Now, we finally in 2025, towards the second half of 2025, started to see more sellers than buyers in the market. This took a long time to actually start to see more listings hit the market. But now, if we do see lower mortgage rates, that could mean that sellers that were thinking about moving into a new house might feel a little bit of relief because the big concern that a lot of sellers had is, hey, I bought a house at a 2.5% mortgage rate. If I buy a new house today, I got to pay 6 and 12 or 7%. I don't want to do that. Maybe we'll just stay in this house longer. But if mortgage rates fall, then that same seller might say, "Hey, I got this 2 and a.5% mortgage rate. If I have to go to a 4%, even maybe a 5%, it's not as bad as a 7%. Maybe we should think about selling and going to that bigger house or the smaller house or into the new city that we're thinking about moving into." So that's where lower interest rates can also work to increase supply."

"And if you balance the supply with demand, meaning you have more houses being built, more construction, more availabilities while there's more buyers, well then that could balance the housing market and make it a little bit more affordable."

"And in all of these instances, the person that wins are the people that are working in the housing market because that means the the realtors, the mortgage bankers, the title agencies, everybody that's working on commission and on the number of transactions would be benefiting because if mortgage rates go down, you bet there's going to be a lot of people refinancing. You bet there'll be more people transacting and that can help the industry get moving again."

"right now for the US government, it's almost a trillion dollars a year that goes to interest payments."