Mortgage Rates Are the Lowest They’ve Been in 3 Years – Is It Time to Buy?

We have all been complaining about mortgage rates the last few years, but  you might have noticed something lately: Mortgage rates recently dropped into their lowest range in almost three years!

Are we back to 3%? No. Does that mean this isn’t worth getting excited about? Also no.

Even a shift down into the 6% range or below can make a big difference in what you can comfortably afford, how your monthly payment feels, and how many other buyers you’ll be competing with.

Let’s break down why this drop still matters in a big way.

1. At 6% or Below, Your Monthly Payment Changes More Than You Think

When rates fall, you don’t just get a nicer number on paper. You get real breathing room in your budget.

Take a simple example:

• On a $400,000 loan at around 7%, the principal + interest payment is noticeably higher.

• When rates move down into the 6% range, that payment can drop by over $300 per month.

That’s not pocket change. That’s:

• Groceries plus gas

• A car payment

• Extra savings or kids’ activities

• Or simply less financial stress every month

Even on a smaller North Dakota loan amount, the same principle applies: a lower rate = more room in your monthly budget.

2. Lower Rates = More Buying Power

When your payment drops, your buying power goes up.

You might be able to:

• Afford a slightly higher price point,

• Move into a neighborhood that’s a better fit,

• Or stay at the same price and simply enjoy a more comfortable monthly payment.

For buyers in and around Ellendale, Oakes, Edgeley, Ashley, Kulm, Forman, and the Bismarck area, that might mean the difference between:

• A starter home vs. one with more bedrooms

• A place in town vs. something on a bit of land

• Or a “good enough” house vs. one that truly fits your everyday life

You don’t have to “stretch” just because rates dropped, but it’s nice to know you have more options.

3. Millions More People Can Now Afford a Home

Here’s where it really gets interesting.

Research from the National Association of REALTORS® (NAR) looked at how many households can realistically afford a median-priced home at different mortgage rate levels.

When rates are at 6% or below:

• About 5.5 million more households can afford the median-priced home

• Of those, roughly 550,000 are likely to buy within the next 12 to 18 months

That’s not just theory. That’s pent-up demand finally getting a green light. The moment rates dip into this more affordable range, a whole group of buyers who have been sitting on the sidelines suddenly step into the game.

4. Why “Getting In Early” Matters

Right now, you’re in a window where:

• Rates have improved from recent highs

• But not everyone has fully reacted yet

• Inventory and competition may still feel somewhat manageable (depending on your area)

Once more of those 5.5 million newly-qualified households realize the math works again, you could see:

• More multiple-offer situations

• Fewer seller concessions

• And upward pressure on prices in certain price ranges

That’s why this drop in rates is still such a big deal:

You have a chance to act before the crowd fully shows up.

You don’t have to rush or panic, but you also don’t want to assume “nothing has changed” just because rates aren’t back in the 3s.

5. What This Means If You’re Thinking About Buying in 2026

If you’re in south-central North Dakota and you’ve been saying things like:

• “We’ll wait until rates come way down.”

• “We’ll just stay put for now; it’s probably not a good time.”

It might be time to at least run the numbers again.

With rates in their lowest range in almost three years you may find that:

• The payment on the type of home you want is now within reach

• Your budget goes a bit further than it did when rates were higher

• You can buy with less stress than you would if you waited for everyone else to notice the change

And if rates improve further later on? You may be able to refinance. In the meantime, you’re already living in the home that fits your life.

Mortgage rates dropping into a 3-year low range might not sound as flashy as “historic lows,” but the impact is very real:

• Lower monthly payments (often by hundreds of dollars)

• More buying power

• Millions more households now able to afford a home

• A chance to move before the full wave of buyers jumps back in

If you’ve been on the fence, this is a great time to talk with a local lender, get a fresh pre-approval, and see what today’s rates look like for your situation.

If you’d like help connecting with a trusted lender or want to explore what you could realistically buy in our local market at today’s rates, I’d be happy to walk through it with you.