The Sacramento housing market is buzzing again — and a lot of that has to do with the Federal Reserve and mortgage rates. If you’ve been wondering how the latest Fed rate cut impacts Sacramento real estate, what’s happening with current interest rates, and whether the market is heating up, here’s what I’ve observed this week.
📉 Fed Rate Cut: What Actually Happened
On September 16, 2025, the Federal Reserve cut its benchmark interest rate by 0.25%, bringing the federal funds rate down to 4.00%–4.25%.
But here’s the important part: mortgage rates didn’t fall after the Fed’s announcement. In fact, they ticked up slightly. Why? Because mortgage lenders had already lowered rates in anticipation of the Fed cut.
This isn’t the first time we’ve seen this. Earlier this year, mortgage rates dropped a week before the Fed meeting because everyone expected a cut. Once the Fed actually made the move, rates stayed flat or even moved higher.
Takeaway: If you hear everyone talking about a Fed rate cut and you see mortgage rates drop before the meeting, that’s your chance to lock in the rate. Waiting until after the announcement often doesn’t pay off.
Current Mortgage Rates
Right now, average rates in California are sitting around:
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30-year fixed: ~6.25%–6.35%
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15-year fixed: ~5.4%–5.5%
These are lower than what we saw earlier in the year.
How the Sacramento Market Is Reacting
The buzz about lower rates has brought more buyers back into the market. Here’s what I’m seeing:
Entry-Level Homes ($400K–$500K)
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This is where the action is.
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Multiple offers are back.
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Some buyers are waiving contingencies and even bidding over asking price — but only if the home is priced right and in good condition.
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This price point attracts first-time homebuyers, who are the largest buyer pool in Sacramento.
Mid-to-High Price Homes ($700K+)
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Multiple offers are less common, but not because buyers are scared — it’s because this price point knocks out many first-time buyers.
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Fewer buyers means fewer competitors, which keeps the frenzy down.
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Sellers in this range need to be strategic about pricing and presentation. A beautifully remodeled home will still sit if it’s overpriced.
New Construction Homes
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Builders are all over the place.
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Some are offering $50K–$80K price reductions, rate buydowns, or closing cost credits.
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Others are offering nothing.
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This is where working with a professional really matters — knowing which communities are giving real value can save you tens of thousands.
Expert Advice for Buyers and Sellers
For Buyers:
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Don’t wait for the Fed meeting to act. If you see a good mortgage rate now, lock it.
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Focus on homes that are priced right and in good condition — that’s where you’ll face the most competition, but also the most long-term value.
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If you’re shopping new construction, lean on an agent who knows which builders are offering the best deals.
For Sellers:
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Understand where your home fits in the market.
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Price strategically — too high and you’ll lose momentum, too low and you leave money on the table.
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Condition matters. Homes that show well and are move-in ready are the ones attracting multiple offers.
📌 Bottom Line
The Fed’s rate cut gave buyers a reason to come back, but the real action happened before the announcement. Mortgage rates are still high compared to a few years ago, but small shifts are enough to spark more demand — especially in the entry-level market.
Sacramento real estate is showing clear patterns:
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$400K–$500K homes are hot again.
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$700K+ homes move more slowly but can still sell strong if priced right.
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New builds are full of opportunities — if you know where to look.
As always, navigating these shifts is about timing, strategy, and having the right guidance.
Thinking of buying or selling in Sacramento? Let’s connect. I’ll help you make sense of the numbers, the incentives, and the timing — so you make the best move in today’s unpredictable but opportunity-filled market.
