Less interest means that buyers can ask for a higher price for their home and the buyer will have the same mortgage payment as they would with a lower priced home and a higher mortgage rate.
The buyer is paying the same TCO in the end so they’ll accept the higher ask from the sellers due to limited supply and the TCO being equal. The Fed is about to start cutting rates so you can watch this happen in real time over the next few years.
Bonds work that way if you hold them to maturity, but the face value is continuously being repriced as rates fluctuate. You don’t have to sell, but that’s how bond pricing works.
The buyer is paying the same TCO in the end so they’ll accept the higher ask from the sellers due to limited supply and the TCO being equal. The Fed is about to start cutting rates so you can watch this happen in real time over the next few years.
Bonds work that way if you hold them to maturity, but the face value is continuously being repriced as rates fluctuate. You don’t have to sell, but that’s how bond pricing works.