Mortgage Rates I had a bad month. Or let’s say three bad years. It’s no surprise that potential buyers are longing for a glimmer of hope in the housing market.

Even with the presidential election The result is resolved, but mortgage rate relief is not for tomorrow. Economic and political uncertainty likely won’t ease much before the Federal Reserve’s November monetary policy meeting ends tomorrow.

Since the start of 2022, the Fed has raised interest rates 11 times to control inflationwhich caused mortgage rates to skyrocket. It’s a safe bet that the Fed will cut the federal funds rate on Thursday, its second cut in more than four years.

The 0.25% interest rate cut expected this week won’t suddenly cause mortgage rates to drop by the same amount. After the Fed’s 0.5% rate cut in September, mortgage rates rose instead of falling.

Although the central bank’s policy decisions and economic outlook affect credit markets, the Fed does not directly set mortgage rates. Mortgage rates are very volatile and respond to several factorssuch as investor expectations, inflation and employment data. For example, after rates hit a two-year low in early September, a surprisingly strong jobs report pushed them back up to almost 7%.

Concern over the presidential election has only added fuel to the fire. Skepticism about the direction of the economy (with either candidate) is one of the main reasons 10-year bond yields rose last month. 10-year Treasury rates and mortgage rates have a strong correlation and tend to move in tandem.

The long-term view of mortgage rates

In recent weeks, bond market investors have panicked over how the next administration’s economic policies could lead to increased government spending and put upward pressure on rates. Rising inflation could prompt the Fed to keep interest rates higher for longer, delaying further rate cuts.

Since the results are clear, there should be less volatility in the bond market and mortgage rates. Experts are not predicting a dramatic drop in mortgage rates, regardless of whether Donald Trump wins the presidency and how the Fed acts.

In the long term, multiple future cuts and weaker economic data are expected help mortgage rates fall. There is usually a lag between when the central bank starts lowering interest rates and when mortgage rates follow a consistently downward trend, said Jeff WenigerCFA and head of equity strategy at WisdomTree Asset Management. Mortgage rates may take two to five years to reflect the full effects of the Fed’s cuts.

Experts also don’t know the new “low” for mortgage rates – it could be 5% or 4% – but it all depends on how the economic outlook evolves. Anyway, a return to rate of 2 to 3% during a pandemic is unlikely.

Learn more: CNET Weekly Mortgage Forecast

Don’t wait for the lowest mortgage rate

Ultimately there is no way to predict the future of the housing market. Anything from another major crisis to a surprise rise in inflation could shake up the economy. Without a crystal ball, your best recourse is to monitor daily changes in mortgage rates.

As mortgage rates begin to fall, some buyers are jumping into the market. Others will wait for even lower rates. Waiting too long could also be risky. Last month, mortgage rates appeared to be moving closer to 6%, but they quickly reversed course. Today, they are close to 7% again.

“It’s impossible to guarantee how mortgage rates will change, so you have to take advantage of opportunities when they present themselves,” said Jeb Smitha CNET Money expert and real estate agent with over 20 years of experience.

You you should not rush into buying a house (even if rates fall) if it doesn’t make sense for your budget or your lifestyle. Taking more time to build your credit score and putting money aside for a larger down payment will help you in the long run, while also helping you save money on your future mortgage.

More Home Buying Tips: