If you have any friends or relatives north of South Carolina and straight up to the northern environs of Maine, it’s safe to call them and say the temperatures are going up, the snow is melting, and if you listen carefully, you’ll also hear sounds of the “housing thaw.”
On February 26, a day that will live in the hearts of all mortgage brokers and real estate agents, the mortgage interest rate fell below 6%.
This was the first time in more than three years, and it could mark an important psychological threshold. Mortgage rates briefly topped 7% last January, but rates have steadily fallen since then. Mortgage brokers discuss the 5% rate zone as the key to getting the market moving. Buyers are starting to recognize that 3% rates aren’t going to happen again and a rate between 5% and 6% is the new norm.
In spite of the fact that economists say it’s unlikely that rates will move substantially from low 6% to high 5%, the fact that it’s moving at all may get that pool of buyers off the sidelines before all of the good properties are snapped up. If this imaginary pool of buyers doesn’t get moving, they’re risking rates going lower, creating more buyer competition and ultimately pushing home prices higher and offsetting the gain of lower rates. Now could very well be the sweet spot for buyers to buy.
Businesses that cater to home sales, like Home Depot, Lowe’s and furniture and appliance stores, are also vested in the real estate market and are watching very carefully for the next step. Any positive economic movement will create new confidence in the real estate market aimed directly at the wannabe homeowners.
Spring is traditionally the season to sell homes, giving families the ability to move over the summer, before school starts. Florida’s market is not geared so much for school enrollment, but the spring season typically generates the most contracts and closings. Part of the reason is potential buyers who are renting during the winter in Florida are looking around and making buying decisions before they leave.
This year has been slow for both buyers and renters, so I’m anxious to see the sales statistics for April and May to determine if breaking that 6% threshold has any impact on sales.
Before I close this column out, the Bradenton Herald had a story a few weeks ago about where Manatee County transplants are moving from. In 2025, 1,332 New Yorkers exchanged their driver’s licenses in Manatee County, marking a 59% increase from pre-pandemic levels. This was the first time since 2022 that a single state topped the migration list.
Following New York, the top contributors to Manatee County’s new residents came from New Jersey, Illinois and Pennsylvania.
Even the western states saw significant migration growth to Manatee County. Washington, Idaho and California, (with a 65% rise) are next in terms of high migration to Manatee County.
I wasn’t surprised about California, since my favorite checkout person at the Holmes Beach Publix told me that about six months ago.
Small reductions in interest rates may not sound like they will influence buyers significantly, however, if you do the math, over a 20- or 30-year period, an eighth or a quarter of a percentage point adds up.
The timing of this rate drop couldn’t be more perfect since demand has been growing for the past few years with low inventory and high rates. However, you will have to listen carefully to hear the cracking of the housing ice. It’s only a whisper now, but pretty soon it could be a roar.
