The U.S. housing market isn’t bouncing back just yet—at least, not according to real estate mogul Barbara Corcoran. Despite a recent dip in mortgage rates, Corcoran insists the market remains difficult, with sellers staying put and buyers struggling to find affordable options.
Read on for the hot takes.
A Difficult Market for Buyers
Corcoran doesn’t sugarcoat the reality of today’s housing market:
No one wants to move and [there are] fewer houses to choose from at higher rates. So it’s difficult for homebuyers.
The pandemic-driven housing boom has cooled significantly, leaving behind sky-high prices and stubbornly high mortgage rates. With fewer homes hitting the market, competition remains fierce, making it tough for buyers to find suitable options.
Mortgage Rates & Market Psychology
While mortgage rates have dipped slightly, Corcoran argues that the decrease isn’t enough to change seller behavior. As of last week:
- The 30-year fixed mortgage rate dropped to 6.96%, the lowest in six weeks.
- The 15-year fixed mortgage rate sits at 6.21%.
But don’t expect a flood of new listings just yet. Corcoran explains why sellers are still holding back:
Mentally, it affects the housing market because people are waiting for very good news and coming down a tenth of a point is not really good news. It went from 7 [percent] to 6.9.
Psychologically, that makes a difference, but with interest rates remaining high, what it really causes is fewer houses on the market.
Many homeowners locked in record-low rates over the past few years, and they aren’t eager to trade those in for today’s higher costs.
Sellers Holding Out & Prices Staying High
The hesitation to sell has led to stagnant inventory and stubbornly high prices. A December Redfin report found that more than 54.5% of homes on the market have been listed for over 60 days, many at price points buyers simply can’t afford.
Corcoran remains skeptical that home prices will drop anytime soon:
I don’t think it’s in the nature of sellers to be realistic, honestly. Their house is always worth more…
I don’t think prices will shake out at all. I think they’ll hold out hoping interest rates will go down again. And what is it to them? It’s another six months. And a lot of the sellers have very low interest rates they don’t want to give up.
With many sellers refusing to budge, buyers may be waiting a while for better deals.
Luxury Market Defies the Trends
While much of the market is sluggish, high-end real estate is thriving—especially in warm-weather states. Corcoran sees luxury sales outpacing the national average by double:
I really like the luxury market. I hate to say, I’m very bullish on that, particularly in warm climates. All the rates… are going up almost double the national average. And that’s a pretty good report card.
The Bottom Line
The broader housing market remains in a tough spot. Sellers aren’t listing, buyers are struggling with affordability, and mortgage rates—while slightly lower—are still too high to trigger a major shift. Unless rates take a significant dip, Corcoran doesn’t see much changing anytime soon.
