After months of watching from the sidelines, many homebuyers who felt priced out by high mortgage rates and affordability issues now have a chance to jump in. With rates starting to trend downward, the current market presents a great opportunity for buyers—but this situation might not stick around for long.

If you've been thinking about making a move but have postponed it, here's why you might want to reconsider putting your plans on hold any longer.

As you consider your choices between buying now or holding off, think about this: What do you believe others will decide to do?

If mortgage rates keep coming down, as experts expect, we could see more buyers returning to the market. A recent Bankrate survey indicates that more than half of homeowners would be encouraged to buy this year if rates fall below 6%.

With rates hovering in the low 6% range, we're not far from reaching that point. The key takeaway is that when rates drop into the 5s, we can expect an increase in buyers entering the market, which will lead to more competition for you.

Increased demand for homes is expected to drive prices higher, which might offset some advantages you would gain from a slightly lower interest rate. As Nadia Evangelou, Senior Economist and Director of Real Estate Research at the National Association of Realtors (NAR), explains:

““The downside of increased demand is that it puts upward pressure on home prices as multiple buyers compete for a limited number of homes. In markets with ongoing housing shortages, this price increase can offset some of the affordability gains from lower mortgage rates.”
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— Nadia Evangelou, Senior Economist and Director of Real Estate Research at the National Association of Realtors (NAR)

Waiting to buy might seem like a wise decision, but if prices keep climbing faster than you're saving from those slightly lower rates, it could end up hurting you.

What This Means for You

You have a great opportunity right now. The current market is favorable for buyers. Why? Many other buyers are biding their time, so there aren’t as many people searching for homes. This means you’ll face less competition.

Affordability has definitely gotten better lately. With mortgage rates easing, owning a home is now more within reach for many people. As Mike Simonsen, Founder of Altos Research, points out:

““Mortgage payments on the typical-price home are 7% lower than last year and are 13% lower than the peak in May 2024.”
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— Mike Simonsen, Founder of Altos Research

““Mortgage payments on the typical-price home are 7% lower than last year and are 13% lower than the peak in May 2024.”
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— Mike Simonsen, Founder of Altos Research

The supply of homes for sale is still low, but it's actually higher than it has been in years. Ralph McLaughlin, Senior Economist at Realtor.com, notes this trend.

““The number of homes actively for sale continues to be elevated compared with last year, growing by 35.8%, a 10th straight month of growth, and now sits at the highest since May 2020.”
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— Ralph McLaughlin, Senior Economist at Realtor.com

You have more choices available to you now than you have in a long time.

With fewer buyers out there, better affordability, and an increased selection of homes, you have the opportunity to find the perfect home before things get competitive.

Why Waiting Could Cost You

If you're holding out for the ideal moment to buy, keep in mind that predicting market movements is very challenging. Delaying your decision could increase the chances of conditions changing, and not always for the better. As Greg McBride, Chief Financial Analyst at Bankrate, points out:

““It’s one of those things where you should be careful what you wish for. A further drop in mortgage rates could bring a surge of demand that makes it tougher to actually buy a house.”
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— Greg McBride, Chief Financial Analyst at Bankrate

Bottom Line

Don’t hold off until the competition heats up and prices go up. Right now, you have a great opportunity to buy a home while the market is favorable. Let’s talk about how you can make the most of this situation.