Just because the rates dropped doesn’t mean the prices will fall.

If you’ve been hoping for home prices to drop, the Fed’s recent rate cut might sound like good news. But before you get too excited, here’s something important to remember: a rate cut doesn’t automatically mean prices will go down - it could be more complex than you might think. 

Here’s what you need to know. 

Rates and prices don’t always go along. Interest rates and home prices don’t always move together. In fact, lower rates often have the opposite effect: they fuel buyer interest. And when more buyers are competing for a limited number of homes, prices can actually go up. Right now, that’s exactly what we’re seeing.

It could bring more competition. It also means more people are jumping into the market. Increased competition leads to more bidding wars and fewer days on market for well-priced homes.

We’ve seen a slight increase in listings, but overall, we're still below the historical average. This supply-demand imbalance means that even with better affordability, prices are staying strong, or maybe even climbing.

“Don’t assume you’ll get a great deal simply by waiting.”

For buyers: don’t wait too long. If you’ve been sitting on the sidelines, waiting for the “perfect” rate drop or hoping for prices to crash, you might want to rethink that. Historically, the average 30-year fixed rate sits around 6.5%, and we’re currently below that.

That means you're in a rare window of opportunity. Waiting too long could lead to higher prices as more buyers compete. It’s a smart move to get pre-approved now and be ready to act quickly when the right home hits the market.

For sellers: Be strategic with your price. With more buyers re-entering the market, sellers have a unique chance to attract serious, competitive offers, but only if they price their home right from the start.

Don’t overprice based on assumptions. Focus on realistic pricing that reflects recent sales, neighborhood trends, and current buyer behavior. A well-positioned listing today can draw multiple offers and sell faster than expected.

While recent rate cuts have reignited the real estate market, that doesn’t mean prices are going down. In many cases, we’re seeing increased demand and firmer pricing.

If you're buying, don’t assume you’ll get a deal by waiting. If you're selling, don’t assume buyers will pay any price. You should be strategic.

And if you want tailored advice for your situation, reach out. Call us at (651) 998-9829or email us at info@holzgroup.com.We’d be honored to help guide your next move in this evolving market.