As of early November 2025, mortgage rates have eased to 6.34% for 30-year fixed loans, with FHA and jumbo loans around 6.13%. This marks a notable shift from the 7%+ highs seen in 2023 and 2024, which had stalled buyer activity and refinancing. The recent decline follows a Federal Reserve rate cut, but Chair Jerome Powell has emphasized that future cuts are not guaranteed, and the Fed remains cautious about inflation and broader economic signals.
Despite that caution, the housing market is already responding. Lenders are seeing increased interest in refinancing, especially from homeowners who locked in rates during the peak. Buyer demand is also picking up, as improved affordability reopens the door for those who paused their search during the rate surge.
However, tight inventory remains a challenge, and homebuilders are still constrained. The article notes that while builders are optimistic about renewed demand, they continue to face labor shortages, regulatory delays, and high material costs, which limit their ability to ramp up production quickly. This means that even as rates improve, supply will remain tight—keeping prices firm and competition strong.
The article underscores that while rates are more favorable, the opportunity window may be short-lived. If inflation rebounds or the Fed shifts back to a more hawkish stance, rates could climb again. For homeowners and sellers—particularly in high-demand markets like Santa Cruz—this moment offers a strategic chance to act: whether that means refinancing, listing, or repositioning before competition intensifies and affordability tightens.
Key Takeaways
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Rates have eased: 30-year fixed mortgages are around 6.34%; FHA and jumbo loans near 6.13%.
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Refinance opportunity: Homeowners with 7%+ loans from 2023–2024 may benefit from refinancing now.
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Buyer demand is returning: Improved affordability is reactivating buyers who paused during the rate surge.
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Inventory remains tight: Limited supply keeps prices firm and competition strong.
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Homebuilding is constrained: Labor shortages, regulation, and material costs are slowing new construction.
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Fed outlook is cautious: Future rate cuts aren’t guaranteed—this window may be short-lived.
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Strategic timing matters: Future rate cuts aren’t guaranteed—this window may be short-lived. If rates continue to drop, buyers could be facing rising prices and more competition
-Inspired by Neil Pierson, Housing Wire, November 4, 2025
