Mortgage rates have fallen to their lowest level in about 10 months—a shift that every real estate agent should be watching closely.
Economic forecasts suggest an interest rate cut at the Federal Reserve’s September Federal Open Market Committee (FOMC) meeting is likely, which could see rates drop even further. While it’s natural to expect more buyer interest, don’t wait for that interest to come to you. If you sense the market heating up, capitalize on that and create the opportunities for yourself.
Reach out to past clients
An essential task as an agent is cultivating and maintaining a sphere of influence—the ones you can always fall back on for leads. Now’s the time to look into that sphere. Lower mortgage rates give people more reason to become homebuyers—which gives you reason to reach out to and find those homebuyers, whether in past clients or individuals in your circle who are ready to become first time buyers.
Did you handle any deals when mortgage rates were at their terrifying peak of 7% plus? Reach out to those clients to let them know why now might be a strong time to refinance (as many homeowners have applied to). Knowing rates are lower might get them thinking about if they’re truly satisfied with their current home, or if they’re due for a change—and you’ll be first on their mind to help them if they do decide that. Even if it does stop at refinancing, they’ll remember you and the tip.
Make sure potential sellers know
While reaching into existing contacts is a reliable move, it can’t end there. A sphere of influence that isn’t growing is one that won’t deliver you new customers. So, expand your sphere too, and give people reason to come to you. Now, lower mortgage rates can be that reason.
Explicitly include the information that mortgage rates are at a recent low in your advertising, from mailbox flyers to carefully planned social media content. You can even add a citation to make yourself appear extra credible. Even if a prospect drawn in by this winds up only being a consultation, that’s another name on your email or phone list.
Find a niche, like second-home buyers
The fundamental rule of investing is spending money to make money—but spending the least you have to is still a wise call. Lower mortgage rates can create not only an opening for people who want to buy a home for the first time or move to a new one, but who want to add a secondary home to their asset portfolio.
Second-home buyers can be a strong niche for business and referrals to it. Remember, the median homebuyer age is up as older generations tend to have more wealth to spend on homes, including secondary homes.
Now, on one hand, second homebuyers are more likely to buy in cash and not worry about a mortgage. However, the lower mortgage rates are creating more listings for them to buy.
Be aware some people still won’t want to buy
Just because an incentive is there doesn’t mean a buyer is going to take it. In fact, a recent report on mortgage applications found them dropping. Remember, rates are still in the 6% range, and to many potential buyers that might still be too high.
A May 2025 report from Realtor.com® on the “lock-in effect” of current mortgage rates found a majority of potential buyers in America want rates below 5% before they consider. Buyers may not have the same holistic perspective you do on what actually “low” mortgage rates are, and may still be waiting for the 2-3% seen during the height of the Covid-19 pandemic. The best way to handle prospects still clinging onto that hope is to move on and find more pragmatic ones.
