Falling rates offer little relief
The 30-year fixed mortgage rate fell to 6.35% last week—its lowest level in 11 months and down from over 7% in January, according to Freddie Mac. But this drop hasn’t done much to boost the market, as economic uncertainty remains high.
The Federal Reserve is expected to cut rates by 25 basis points today to help the job market, after pausing earlier in the year because of inflation worries tied to tariffs. Still, most analysts said lower rates alone wouldn’t make up for slow job growth and rising unemployment.
Unsold homes and broken contracts
The slowdown is happening as unsold homes pile up. According to Zillow, homes now take 27 days on average to sell—about a week longer than last year. New listings fell 7.3% from July, hitting their lowest point since Zillow began tracking.
Similarly, Realtor.com reported that in July, 57% more homes were pulled off the market compared to a year earlier. For the first time in years, more homes left the market unsold than were added, especially in the South and West, where sellers have been less willing to negotiate.
At the same time, the job market is losing steam. The Bureau of Labor Statistics said only 22,000 jobs were added in August, much lower than the 76,500 expected. Unemployment also ticked up to 4.3% from 4.2%.