{"id":187086,"date":"2026-03-06T12:48:30","date_gmt":"2026-03-06T19:48:30","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=187086"},"modified":"2026-03-06T12:49:29","modified_gmt":"2026-03-06T19:49:29","slug":"lower-mortgage-rates-could-increase-home-prices-but-heres-how-you-can-find-deals","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/lower-mortgage-rates-could-increase-home-prices-but-heres-how-you-can-find-deals","title":{"rendered":"Falling Mortgage Rates Could Make It Harder to Find Cash Flowing Properties\u2014But Here’s How Investors Can Find Them Anyway"},"content":{"rendered":"\n

Mortgage rates have hit their lowest levels in three years,<\/a> and while that should be a cause for celebration from prospective homebuyers, it hasn\u2019t translated into greater sales. In fact, it could trigger the opposite: a greater affordability crisis.<\/p>\n\n\n\n

According to brokerage and listings site Redfin,<\/a> 13.7% of homes that went under contract in January fell through\u2014the highest share ever recorded for that month. There are two main reasons for this. <\/p>\n\n\n\n

First, it\u2019s a buyer\u2019s market<\/a>, so they can afford to pick and choose. However, the second reason has greater repercussions for investors: financial insecurity. <\/p>\n\n\n\n

Many buyers are walking away from deals because they are worried about the additional costs of owning a home\u2014taxes, insurance, and maintenance\u2014all of which are soaring. Additionally, there is job insecurity and the fear of how tariffs will affect their business and income, which, coupled with the overall cost of living, from food prices to furnishings and energy costs, has many buyers fearful about using a large lump of cash for a down payment and then being on the line for a cadre of monthly expenses they didn\u2019t have when they were renting.<\/p>\n\n\n\n

\u201cThey\u2019re second-guessing the wisdom of making a huge purchase when there\u2019s a fear in the back of their mind about the state of the economy and the uncertainty of their finances,\u201d Los Angeles real estate agent Alin Glogovicean told Redfin\u2019s news site. \u201cThat\u2019s particularly true when they\u2019re first-time buyers who don\u2019t have equity<\/a> from a previous home sale, and they\u2019re using most or all of their savings on a down payment<\/a>.\u201d<\/p>\n\n\n\n

Mortgage Rates Fall, But Affordability Barely Moves<\/h2>\n\n\n\n

Despite mortgage rates dropping below 6.1%, NAR\u2019s chief economist Lawrence Yun says that has not translated into sales. He said in a press release<\/a>: <\/p>\n\n\n\n

\u201cImproving affordability conditions have yet to induce more buying activity\u2026Unless housing supply increases, these additional potential buyers becoming active in the market could simply push up home prices. This will put increasing pressure on affordability, which is why it is critical to increase supply by building more homes.\u201d <\/em><\/p>\n\n\n\n

The market is not monolithic, and while sales are stagnant nationally, Realtor.com reports<\/a> that these markets saw increased sales year over year as of January:<\/p>\n\n\n\n