Why Now Is a Pivotal Moment in Real Estate: Mortgage Rates Are Down, Fed Cuts Are Coming

Mortgage rates have quietly dipped to their lowest average in nearly a year—hovering around 6.5% for a 30-year fixed loan. That drop, combined with signs that the Federal Reserve may soon cut interest rates, is creating a ripple effect across the real estate market. And whether you're planning to buy, sell, or simply watching from the sidelines, now is a moment worth understanding.

So how can rates already be this low if the Fed hasn’t even cut rates yet? The short answer: the market moves in anticipation. While the Federal Reserve doesn’t directly set mortgage rates, it strongly influences them. Mortgage rates tend to follow the bond market, particularly the 10-year Treasury yield, which reacts to broader economic trends and investor sentiment. Lately, data showing cooling inflation and a softer job market has led many to believe the Fed will cut rates in the coming months. As a result, mortgage lenders are adjusting preemptively, which is why rates are already trending lower—even before any formal announcement from the Fed. In other words, the market is pricing in what's likely to come next.

Over the past year, affordability challenges and elevated borrowing costs kept many would-be buyers on pause. Sellers hesitated, too, often unsure if they could sell high and buy smart in the same breath. But as rates begin to fall, confidence is returning to both sides of the transaction. Lower mortgage rates mean lower monthly payments, which naturally drives more buyers into the market. And while the shift isn’t dramatic—yet—it’s meaningful enough to change the timing strategy for anyone thinking about making a move this fall.

For sellers, this presents a renewed opportunity. Over the summer, we saw a modest buildup of inventory as homes sat longer than expected. But much of that surplus has already cleared out, and in many Bay Area neighborhoods, inventory has tightened again. With more buyers re-entering the market in response to lower rates, the balance is tilting in favor of well-prepared listings. If you’ve been thinking about selling, now is the time to start getting your home market-ready. Pricing it strategically, staging it thoughtfully, and hitting the market before inventory rises again could position you to attract serious buyers quickly—especially before the fall surge brings more competition.

On the buyer side, the message is simple: don’t wait too long. As rates fall, demand rises—and with it, so does competition. Homes that might have lingered on the market in the spring are now receiving renewed interest, sometimes multiple offers, and in some cases, bidding wars. If you’re actively looking, acting sooner rather than later could give you the edge, especially before prices respond to the shift in buyer activity. Getting pre-approved, staying informed, and having a strong agent in your corner can make all the difference in navigating this next phase of the market.

The bottom line? We’re heading into a window where lower borrowing costs meet limited inventory and renewed buyer urgency. That combination won’t last forever. Whether you're planning to list or hoping to buy, this moment—just ahead of the fall market—might be your best opportunity to make a move with confidence.

Thinking of making a move? Let’s talk strategy.
Whether you’re buying, selling, or just exploring your options, I'm here to help you navigate the market with confidence.Let’s connect and talk about how homeownership can benefit you in today’s market! Email me at kevin@pickettrealestategroup.com or call me at 415.283.7919 

San Mateo County Rolling 3-Month Data

Below, our data is based on averages for Single-family homes in San Mateo County over the last 90 days (June 2025 to August 2025). This data was gathered on September 02, 2025. 

San Mateo County Market Report

Thinking of selling? 

I'd love to discuss your home's value and positioning in the current market. Call or text Kevin at 415.283.7919 or email Kevin at Kevin@PickettRealEstateGroup.com