Housing Research Brief

Recent interest rate changes carry implications for housing. While the 25-basis-point cut to the overnight rate in September was the Federal Reserve’s first reduction since 2024, longer-term interest rates had already started to dip in anticipation. Between July 31 and Sept. 4, the average 30-year fixed rate mortgage fell from a weekly mean of 6.72 percent to 6.50 percent. This decline may have helped more prospective homeowners sign contracts. The number of new homes sold last month jumped to a seasonally adjusted annualized total of 800,000 — a four-year high reminiscent of pre-2007 volumes. This momentum may carry forward too, as the 30-year mortgage rate continued to fall through much of September. The average dropped to 6.26 percent the same week as the Fed rate cut before inching up to 6.30 percent by Sept. 25.