We've heard some version of this from buyers quite a bit over the past few years:
"I'm going to wait until mortgage rates come back down."
We completely understand the thinking. When you've seen mortgage rates in the 3% range, today's rates can be hard to swallow. And if waiting another six months or a year could get you a mortgage at 5%, why wouldn't you wait?
There's just one problem.
Nobody knows when - or if - we're going to see 5% mortgage rates again anytime soon.
And waiting for that magic number could mean overlooking some advantages buyers have in today's market.
Mortgage Rates Aren't Falling the Way Many Buyers Expected
As of August 20, the average rate on a 30-year fixed mortgage was 6.65%, according to Freddie Mac.
Rates have moved up and down over the past several months, but they've remained stubbornly above 6%.
And current forecasts don't suggest a dramatic decline is imminent.
Fannie Mae's August housing forecast projects the 30-year mortgage rate averaging 6.8% during the fourth quarter of 2026 and 6.7% in 2027.
The Mortgage Bankers Association has expressed a similar outlook, saying it expects mortgage rates to remain around 6.5% for the foreseeable future.
Forecasts can certainly be wrong. Economic conditions change, inflation changes, and mortgage rates can move quickly.
But that's exactly the point.
Waiting to buy solely because you're counting on a particular future mortgage rate is essentially making a bet on something none of us can predict.
But Wouldn't a 5% Rate Save Me a Lot of Money?
Absolutely.
There's no question that a lower mortgage rate improves affordability.
For example, consider a $400,000, 30-year mortgage:
At 6.65%, the principal-and-interest payment would be approximately $2,568 per month.
At 5%, that payment would be approximately $2,147 per month.
That's a difference of about $421 per month.
So we're certainly not suggesting mortgage rates don't matter. They matter tremendously.
The question is whether waiting for a lower rate necessarily puts you in a better position.
And that's where things get interesting.
What Happens If Everyone Else Is Waiting Too?
Imagine mortgage rates really do fall to 5%.
You probably won't be the only buyer who notices.
Lower rates improve affordability for millions of potential buyers. Some people who couldn't qualify at 6.5% may suddenly qualify. Others who have been sitting on the sidelines may decide it's finally time to start looking.
More buyers entering the market can mean more competition for the same homes.
That can lead to fewer seller concessions, multiple-offer situations and upward pressure on prices.
In other words, you might get the mortgage rate you've been waiting for - but give up some of the negotiating power available to you today.
Today's Asheville-Area Market Gives Buyers Something Valuable: Choices
This is where the local market becomes particularly interesting.
According to Canopy MLS, the Asheville region had 6.3 months of housing inventory in July. Homes also took an average of 110 days from listing to closing, and sellers received about 93.1% of their original asking price.
At the same time, buyer activity hasn't disappeared. For the week ending August 8, pending sales in the Asheville region were up 28.8% compared with the same week last year.
So buyers are buying.
They're just doing it in a market where they generally have more time, more choices and more negotiating leverage than they did during the frenzy of a few years ago.
That's worth something.
The Purchase Price Isn't the Only Thing You Can Negotiate
In a market with more inventory, buyers may have opportunities that simply weren't available when homes routinely received multiple offers within days.
Depending on the property and the seller's circumstances, a buyer might be able to negotiate:
- A lower purchase price
- Seller-paid closing costs
- Repairs following the home inspection
- A credit toward repairs
- A mortgage rate buydown
- A more favorable closing timeline
Not every seller will agree to these things, of course. Every property and every transaction is different.
But buyers today can often ask.
A few years ago, many buyers were doing the opposite - waiving contingencies, offering above asking price and competing against multiple offers just to get a house under contract.
That's a very different environment.
What If Rates Drop After I Buy?
This is another question we hear frequently.
If mortgage rates eventually fall substantially, refinancing may be an option.
That's not a guarantee. Refinancing comes with costs, you'll need to qualify, and whether it makes financial sense will depend on your circumstances and the rates available at the time.
But buying a home today doesn't necessarily mean you're committed to today's mortgage rate for the next 30 years.
Your purchase price, on the other hand, doesn't change after closing.
That's one reason I think buyers should consider the entire opportunity, rather than focusing exclusively on the interest rate.
We're Not Saying Everyone Should Buy Right Now
This is important.
Buying a home simply because you're afraid rates might not fall isn't a good reason to buy one.
You should be financially comfortable with the payment. You should have appropriate savings. You should expect to remain in the home long enough for buying to make sense. And, most importantly, you should find a home that actually works for you.
For some people, waiting absolutely will be the right decision.
But there's a difference between waiting because you're not ready to buy and waiting because you're convinced mortgage rates will soon return to 5%.
The first is a personal financial decision.
The second is a prediction about the future.
The Bottom Line
Could mortgage rates eventually fall to 5%?
Of course.
Could they remain in the 6% range much longer than buyers expect?
Absolutely.
None of us knows.
What we do know is what the market looks like today.
Here in the Asheville area, buyers currently have more inventory to choose from, homes are taking longer to sell, and sellers are generally negotiating more than they were during the extremely competitive market of a few years ago.
So instead of asking:
"Should I wait until mortgage rates hit 5%?"
We think there's a better question:
"If I found the right home today, could I comfortably afford it at today's rate?"
If the answer is no, waiting may make perfect sense.
But if the answer is yes, don't automatically assume that waiting for a lower mortgage rate will ultimately get you a better deal.
Sometimes the best time to buy isn't when one particular number reaches the level you hoped for. It's when the home, the price, the payment and your own circumstances all come together.
And if you're trying to figure out whether they do, we're always happy to help you look at the bigger picture.
That's part of guiding people home.
