Market Update · August 14, 2026 · 7 min read
Mortgage rates dropped this week to 6.67% for a 30-year fixed, according to Freddie Mac's latest survey. That's the lowest we've seen in nearly four weeks, thanks to cooler-than-expected inflation data in the Producer Price Index that came out Thursday.
You'd think buyers would be celebrating. Maybe even scheduling showings.
Instead, the number of active buyers in the U.S. market just fell to a record low of about 967,000 in July, according to Redfin. Sellers outnumbered buyers by 51% last month, putting us just shy of December's all-time high. Nearly 80% of agents reported more sellers than buyers in their local markets.
I'm seeing this play out in real time across Harford, Cecil, Baltimore County, and into Montgomery and Prince George's. Open houses that would've had a line out the door two years ago? Now I'm lucky if three couples show up. And they're cautious. They want to see everything twice, they're asking for seller concessions, and they're walking away the second something feels overpriced.
So what's going on? If rates are dropping and inventory is finally starting to move, why aren't buyers jumping in?
Here's what I tell clients when we sit down at my kitchen table or theirs: a 6.67% rate sounds better than 7.2%, sure. But when you're looking at a $450,000 median-priced home in Howard County or a $375,000 starter in Harford County, that monthly payment is still crushing for most families.
The issue isn't just the mortgage rate in isolation. It's what that rate does when you layer it on top of home prices that are still near all-time highs. Zillow reported that they're forecasting rates to fall only to 6.5% by year-end, and even that modest drop won't be enough to offset affordability challenges for a lot of buyers in our region.
Add in property taxes (which, if you've been following the news out of places like Ohio, are becoming a real crisis), homeowners insurance that keeps climbing, and the reality that wages haven't kept pace? You've got a recipe for hesitation.
One of my first-time buyer clients in Baltimore County told me last week, "We can technically afford the payment, but it doesn't leave us any cushion. What if the furnace goes?" That's the conversation happening in a lot of households right now.
The flip side of this is that sellers are not sitting on the sidelines. There were about 1,463,000 sellers in the market in July, which means buyers are badly outnumbered.
I wrote about this dynamic just yesterday, but it's worth repeating: if you're thinking about selling your house in Anne Arundel, Charles, or Baltimore City, this is actually decent news for you. Competition among buyers is lighter than it's been in years. But that doesn't mean you can throw your house on the market with zero prep and expect a bidding war.
We're in a weird middle zone. Buyers have more negotiating power than they've had since 2019, but sellers who price correctly and show well are still getting offers. I had a listing in Bel Air close last week at 98% of asking after one price adjustment and a small credit for inspections. It sold, but it took work.
Let's ground this in our backyard. Redfin also reported that pending home sales edged up 0.4% week-over-week during the four weeks ending August 9. That's seasonally adjusted, and it's a tiny uptick in an otherwise sluggish summer.
But the big story is that home sales overall dropped to their lowest level in nearly two years, with Texas and Seattle driving a lot of that decline. Tech layoffs in Seattle and economic instability in Texas are spooking buyers there.
We're not Seattle. We're not Austin. But we are feeling the ripple effects of a national economy that's still uncertain, inflation that refuses to fully cool, and a Federal Reserve that's walking a tightrope. Three Fed voters actually pushed for a rate hike at the last meeting, even though the Committee held steady. That tells you how nervous policymakers still are about inflation.
In Maryland, DC, Pennsylvania, and Delaware, we've got our own quirks. The DMV market has always been a bit insulated thanks to government jobs and defense spending. York and Lancaster Counties in PA are seeing buyers priced out of the Philadelphia suburbs. New Castle County in Delaware? Still a sweet spot for people who want lower property taxes than Maryland but easy access to I-95 and the mid-Atlantic job markets.
But none of that changes the fact that buyers are skittish. They're waiting to see if rates drop further, if prices soften, or if the economic picture becomes clearer.
One more thing worth mentioning: Zillow found that starter homes are piling up while luxury homes are flying off the market. Supply, price cuts, and competition are moving in opposite directions depending on price tier.
I'm seeing some of that locally. Higher-end homes in places like Annapolis, parts of Montgomery County, and waterfront properties in Cecil County are still moving when they're priced right. Buyers at that level aren't as rate-sensitive because they're often paying cash or putting down 40%.
But starter homes in the $250K–$375K range? Those are sitting longer, and sellers are having to cut prices or offer concessions. It's counterintuitive, because you'd think entry-level homes would be in higher demand given the shortage of inventory. But when affordability is this tight, even "affordable" homes feel out of reach.
If you're trying to sell your house in Prince George's County or another area where starter homes dominate, you need to be extra sharp on pricing, staging, and condition. Buyers in that price range are stretched thin, and they've got options now.
If you're a buyer in Maryland, DC, Pennsylvania, or Delaware, this is honestly not a bad moment to be looking. Yes, rates are still elevated compared to the 3% days (which, let's be honest, we're never seeing again). But you've got leverage. Sellers are more willing to negotiate. Inspection repairs that would've been laughed at in 2021 are now on the table. You can take your time.
Get pre-approved, understand what your true monthly payment will be including taxes and insurance, and don't stretch beyond what feels comfortable. If you're a first-time buyer, make sure you've talked through everything I tell clients before we ever tour a house. Rates might drop a bit more by year-end, but they also might not. If you find the right house and the numbers work, don't wait for perfection.
If you're a seller, price it right from day one. The days of "testing the market" with a high price and seeing what happens are over. Work with a Realtor who knows your county and can pull accurate comps. Stage it, fix the obvious stuff, and be ready to negotiate. The buyers who are out there have choices, and they're using them.
And if you're just watching and waiting, that's fine too. Not every season is your season. But keep an eye on rates, keep tabs on inventory in your target area, and stay in touch with a local Realtor (hi) who can give you the real story, not the national headlines.
Rates dropped this week to 6.67%, and that's legitimately good news. But it's not enough to overcome near-record home prices, economic uncertainty, and the reality that a lot of families are just plain tired. Buyer demand is at a record low, and that's creating a market that favors buyers in some ways but also leaves a lot of sellers frustrated.
If you're navigating this market in Harford, Cecil, Baltimore, Montgomery, Howard, Anne Arundel, Charles, Prince George's, DC, York, Lancaster, or New Castle County, I'm happy to walk you through what's happening in your specific neighborhood. Take a look at current listings or just reach out. I spent 20 years teaching before I ever sold a house, so I'm here to explain, not pressure.
The market's weird right now. But weird doesn't mean impossible.
Katrina Kirton Sherrod, REALTOR® · Samson Properties · Licensed in MD, DC, PA & DE · 443-616-9770 · Katrina@kkstherealtor.com
“The best time to buy a home was five years ago. The second best time is after we talk.” — Every honest realtor, eventually