How could rate cuts impact Charlotte realtors, homebuyers and owners?

CHARLOTTE, N.C. (QUEEN CITY NEWS) — An anticipated rate cut on Wednesday is sparking hope and excitement in the Charlotte housing market.

“It was a constant conversation especially for those that were on the edge of qualifying,” realtor with Stone Realty Group Megan Otte said.

Otte is talking about mortgage rates. In four years, they have doubled across the Queen City, forcing a large chunk of buyers and existing homeowners to stay put.

“I think a lot of people have been waiting and sitting on the sidelines,” Realtor with Pridemore Properties Team Caranna O’Melveny said.

The two Charlotte realtors work at two separate firms and are both anticipating a similar shift – more homebuyers entering the market in coming months as mortgage rates continue to drop.

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As of this month, the average rate for a 30-year fixed loan is 6.8%.  The Mortgage Bankers Association is anticipating it to drop to 6.4% by the first quarter of 2025.

“And, even that small dip in interest rates is going to impact their buying power.  So, I think that it what it is all about is people that are looking to buy, it’s about their bottom line,” O’Melveny said.

According to the National Association of Realtors, in July the median listing price for a home in Charlotte was $439,000.

Queen City News used a mortgage calculator to see how much of an impact a one percent interest rate change can have on monthly payments, assuming the buyer puts down a 20% deposit and has a standard 30-year fixed mortgage rate.

With a seven percent interest rate, the average buyer in Charlotte is look at paying around $2,922 dollars a month.  With a six percent interest rate, the price drops to $2,691 a month.

That’s about a $2,700 a year difference, or $81,000 over the life of the loan.

“I do anticipate it and my firm does and I think realtors across the Charlotte metro area are ready for our phones to start ringing for those buyers,” Otte said.

A change in rates is not just impacting buyers, Charlotte realtors say existing homeowners who bought in the last year and a half are also watching rates closely.

“Pretty much everyone that I sold to last year, I am ready for their loan officers’ phones to start ringing because they are going to start all of that refinancing once these rates drop,” Otte said. One downside of rate cuts is that it could fuel more competition in the market and increase housing costs.

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