The housing world is frozen in a state of trapped homeowners who don’t want to sell, and reduced affordability partly because of high borrowing costs. But there could be a spring thaw in September that might help melt the market.

It’s a magic number for mortgage rates. And given Federal Reserve Chair Jerome Powell’s dovish tone on Friday, lending costs are poised to drop, clearing the way for lower costs on a home loan. There’s somewhat of a consensus that once mortgage rates dip to 6% or less, it’ll be irresistible to those who have been biding their time. Earlier this year, self-made real estate millionaire and Shark Tank star Barbara Corcoran said 6% seems to be the “magic number,” that’ll bring sidelined buyers back in. Robert Reffkin, cofounder and chief executive of realty giant Compass, in June said: “I think 6.5% I’d feel good about … but the magic number is 5.9999.” He continued: “That’d be marketing magic, and would tell the world that mortgage rates are at a level where they should go and grab a property.” 

Then there’s Meredith Whitney, the “Oracle of Wall Street” and chief executive of her own research firm, who said this month, if mortgage rates drop below 6%, we’ll see a spike in home sales.

We aren’t there yet, but we are inching closer and closer. The weekly average for the 30-year fixed mortgage rate came in at 6.46% yesterday. In the release, Freddie Mac said, “softer incoming economic data suggest rates will gently slope downward through the end of the year. Earlier this month, rates plunged and are now lingering just under 6.5%, which has not been enough to motivate potential homebuyers. Rates likely will need to decline another percentage point to generate buyer demand.” (Daily mortgage rates are the same, at the moment.)

And it’s true that it hasn’t been enough to really move the needle because existing home sales are still pretty depressed, for one. In July, there was a small rebound; existing home sales rose 1.3% from the prior month, but were still down compared to last year. “Despite the modest gain, home sales are still sluggish,” the National Association of Realtors’ chief economist, Lawrence Yun, said. “But consumers are definitely seeing more choices, and affordability is improving due to lower interest rates.”

Capital Economics’ economist Thomas Ryan called existing home sales “underwhelming” in light of the substantial drop in mortgage rates last month, but it could just take more time for that to reflect in sales data—so August could tell a different, more magical, story. Still, he reiterated his stance that there won’t be “a rapid revival” in the housing market this year, regardless of lower borrowing costs. For Ryan, mortgage rates would have to fall below 5% to see a full recovery, he’s previously said.

On the other hand, new home sales, which have generally outperformed existing home sales, rose 10.6% in July. Ryan chalked that up to “pent-up buyers taking advantage of the sharp drop in borrowing costs last month, after having been sidelined earlier this year by high mortgage rates.” Still, homebuilders have been offering incentives, such as mortgage rate buydowns, so that could be part of it, too. It isn’t completely clear why lower mortgage rates seemed to matter more in the new home segment versus the existing one.

Either way, it looks like the Federal Reserve is ready to start cutting interest rates. While a single cut won’t solve all, partially because it’s already priced in, it would be a step in the right direction, where mortgage rates are concerned. Who knows, sometime next year, we might finally reach the magic number. 

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