Should I wait for rates to drop?

The forecast is flat, not falling

Fannie Mae's October 2026 forecast expects the 30 year fixed rate to stay near 7.4% for the rest of 2026 and around 7.5% through 2027. A forecast is not a promise: rates can move fast in either direction. This fall, for example, they went from about 6.7% in late August 2026 to 7.40% on October 8, 2026.

Waiting may trade a quiet market for a crowded one

When rates drop, everyone who has been waiting comes back at the same time. Pending home sales in September 2026 fell to the lowest level in NAR records, which date back to 2001, so there is a lot of buying power sitting on the sidelines. Lower rates would also bring more sellers back, so you would have more homes to choose from, but more competition for the best ones.

Lower rates won't change your home's value much

In a September 2021 study, researchers at the New York Fed found that home prices react much less to mortgage rates than common models predict. By their estimate, a 1 point drop in rates raises home prices by about 2% at most, and it can take a while to show up in prices.

What you can do instead of waiting

First, bargain now. Look at how long homes like the one you want sit on the market, how many nearby listings have already cut their price, and how close homes are selling to their asking price. Those three numbers often show more room to negotiate than buyers expect.

Second, ask about a rate buydown, where the seller pays money up front to your lender in exchange for a lower rate. Redfin reported that sellers gave concessions in 44.7% of sales from June through August 2026, the highest share for those months since 2020, and concessions can include a buydown.