Market Update: Mortgage Rates Get Spooked by Haunting Words

Blog posted On October 31, 2025

Do you feel that? The chill in the air? Just when mortgage rates were trending around their lowest levels of the year, something made them jump. Now, they’re trending higher, with a classic time warp erasing the gains they had made earlier this week. The culprit? Not a masked monster, but a familiar face…read more to see who’s the source of the spooks.

The Fed's Rate Cut

The Federal Open Market Committee (FOMC) wrapped up its October meeting on Wednesday with the second consecutive quarter-point rate cut this year, bringing the benchmark rate down to a range of 3.75% to 4.00%. Seems simple enough, right? But then came the real show: Fed Chair Jerome Powell's press conference. Historically, this is what moves the markets one way or another on Fed day.

What Spooked Mortgage Rates?

Mortgage rates typically move BEFORE Fed announcements, not after. Think of it like knowing which house has the best candy before Halloween night — the market had already priced in this week's rate cut, which is why we saw mortgage rates creeping downward throughout October, reaching their lowest levels in over a year before the Fed meeting.

The recent upward bounce was largely from Fed Chair Jerome Powell himself jump scaring markets during his press conference, stating that a December rate cut is "not a foregone conclusion. Far from it." The markets were not expecting this, so they repriced.

Your Survival Guide: What to Do Next

The current market environment is less "haunted mansion" and more "mysterious opportunity" if you know where to look:

If you're hunting for a home:

• Today's rates, while not supernatural lows, are significantly sweeter than six months ago
• With more inventory and less competition, you won't be fighting zombie hordes in bidding wars
• Get preapproved now so you're ready to pounce when you find the right property
• Don't try to predict the future — rates could move either direction based on economic data

If you're considering a refinance:

• A general rule of thumb: if you can lower your rate by 0.75 to 1 percentage point, refinancing could banish your high-payment demons
• Calculate your breakeven point by dividing closing costs by monthly savings
• Consider your plans: if you're moving within 2-3 years, refinancing might not be worth it

If you're selling:

• Be realistic about pricing — overpriced listings are sitting longer than skeletons in a graveyard
• Consider offering buyer incentives if you need move quickly

Happy Halloween, and happy house h(a)unting!

Sources: Mortgage News Daily