Fed cuts interest rates - a necessary boost for the US housing market

VTV.vn - US home prices remained virtually unchanged last week, as the pace of supply growth slowed due to weak demand.

A house for sale in San Mateo, California, USA. Photo: THX/TTXVN

However, the Federal Reserve's interest rate cut last week – the first of three expected cuts this year – could provide a much-needed boost to the housing market.

After a “tough summer” of frustrated sellers and hesitant buyers, the week ending September 13 saw the U.S. housing market slow down, with early signs of a downward trend, according to the latest report from Realtor.com.

“Despite recent declines in mortgage rates, historic highs and cost pressures are keeping many buyers at bay, forcing sellers to adjust their prices to attract interest,” said economist Anthony Smith of Realtor.com.

Heading into the fall, the total number of homes for sale was at its highest level since before the COVID-19 pandemic, giving buyers more options and more time to consider.

Meanwhile, seven major metro areas in the South and West, led by Miami, moved into “buyer-friendly markets,” suggesting the US housing market is gradually balancing as it enters the best period to buy a home in October 2025.

Another positive sign is that rents have fallen for two consecutive years, making many renters more optimistic about the opportunity to own a home as economic conditions improve.

The 30-year fixed mortgage rate fell to 6.26% last week, marking its fourth consecutive weekly decline, according to Freddie Mac. The Fed cut its benchmark interest rate by 0.25 percentage point to 4%–4.25% at its September 16–17 meeting, marking the first reduction since December 2024. President Donald Trump has called for the Fed to do more to revive the sluggish housing market, but most Fed members took a cautious approach at last week's meeting.

Although the rate cut was widely anticipated, Realtor.com economist Jiayi Xu said home sales will improve slightly in the coming months.

A home for sale now takes an average of six days longer to sell than it did a year ago, a slowdown that reflects the impact of high home prices and mortgage rates, along with economic uncertainty that has kept many potential buyers on the sidelines.

However, the situation is uneven: the Northeast and Midwest face tight supply and strong demand, while the South and West have a surplus of homes for sale and slow sales.

The number of new homes for sale rose 2.1% year-on-year, after falling nearly 2% the previous week – the first decline since April 2025. Still, the supply of new homes remains below levels typically seen in spring and early summer, largely due to weak demand.

The total number of homes for sale was still up 17.6% year-over-year, marking the 13th consecutive week of slowing growth. The week ending September 13 was also the 97th consecutive week of year-over-year increases in the supply of homes in the U.S. A total of 1.1 million homes were listed for sale last week, the 20th consecutive week the number has remained above 1 million. “Inventory is growing much faster than new homes for sale, suggesting that more homes are sitting on the market longer,” Smith said.

Source: https://vtv.vn/fed-giam-lai-suat-cu-hich-can-thiet-cho-thi-truong-nha-o-my-100250922150142839.htm