August 26, 2025

Interest Rate Reduction News

A few days ago, Jerome Powell, the Chair of the Federal Reserve, signaled a likely an interest rate cut in the near future. We used that as a jumping off point to speak with local realtor, Nick Rizzi, at Happy Homes in Colorado, about the implications of a rate cut to people interested in purchasing a home in 2025.

“The interesting part that matters more (than an actual rate cut) is that the news outlets talked about it and the mortgage markets already started to price it in,” says Nick. “We went from 6.98 on Friday to 6.55 (yesterday, August 25) and I’m hearing there’s an 83% chance of at least a 25 basis points’ reduction. So a quarter percent – and that would be very big news.”

How Rates Impact Affordability

For the average home buyer sitting on the fence waiting for rates to drop, what does that actually mean? How does that affect affordability? 

Generally speaking, Nick said, for every percentage point drop or increase, your purchasing power is affected by 10 percent. “In Looking Glass, for example, if we were to drop a full percentage, that translates to a $60,000-to-$80,000 difference in purchasing power, depending on how much you’re putting down,” said Nick.

Interest Rate Incentives from New Home Builders

Typically, rates go down because people are nervous about the economy, Nick went on to explain, “and right now we’re in a bit of a chokehold – it’s scary buying a new house. It’s a big purchase and a big decision, but when rates go down, more potential buyers are added to the market,” he said.

In the meantime, one of the new home builders in Looking Glass | Parker will beat that quarter percent interest rate reduction, right now. Through next Tuesday, September 2, Dream Finders Homes is offering buyers a 2.99 % rate (5.746 % APR) or a 3.99 % (5.813% APR) on select homes already under construction, and 4.99% on homes that close by year-end.

Says Nick, “That’s one big advantage of new builds – the incentives that builders are able to offer their buyers.” For the next week, home seekers choosing Dream Finders Homes in Looking Glass can save money on models like the Ironwood, Conifer, Silverthorne and Braeburn. These new builds are priced from $680K to $755K with from three bedrooms, two and a half baths to four bedrooms with three and a half baths. If you’re ready to move soon and need between 2,000 and 3,000 square feet – you don’t have to wait on the Federal Reserve to afford the home of your dreams. 

The Parker Real Estate Market

“Parker’s average home price is about $632,000 which is the highest it’s been, and everything south of Hess is about $715K because of so many new developments,” Nick reported. “It’s interesting because our days on market (DOM – the time it takes a home to sell) have doubled. We went from about 50 DOM in 2024, even less than that in a lot of cases, to now a market average of 95 in Parker,” Nick said. A frame of reference is the real estate market in Denver, he noted, where a single-family home is closer to 135 DOM and prices are beginning to drop.

Does that mean we are entering a “buyer’s market”? Technically, it’s pretty even, says Nick, but seems to be tipping toward buyers. “The statistics disagree with me, because we are technically back to 2018 levels in terms of days on market and pricing,” he said.

“But I would say buyers have more power now and they should be treating it as a buyer’s market, because that is the perception, regardless of the numbers.”

Next week we’ll continue to explore trends and the short and long-term outlook for the real estate market here in Parker. For more information between now and then, Nick Rizzi is available to answer questions or take house hunters through the neighborhood. He and his family are fans and residents of Looking Glass and have an insider’s POV.

Let Looking Glass Lead You Home

With a variety of incentives and promotions available, it’s time to check out the quick move-in possibilities at Looking Glass, starting in the $600s. D.R. Horton, Taylor Morrison and Dream Finders, have one and two-story models, with attractive elevations and plenty of floor plan options for personalizing your new home. Discover the cost-savings and ready-now opportunities available at Looking Glass in Parker!