If you’re considering buying a home, there’s no day like today to make the move, says real estate mogul Barbara Corcoran.

According to Freddie Mac, the 30-year mortgage rate fell slightly last week to 6.79%, well below the October peak of 7.79%. For homebuyers, the prospect of waiting for lower borrowing costs can seem very tempting.

But Corcoran, Shark Tank star and founder of the Corcoran Group, disagrees.

Speaking on Yahoo Finance Live (video above), Corcoran warned that lower rates could bring more buyers into the market, increasing competition and sending already high prices “through the roof.”

“If interest rates drop one more point by the end of the year, everyone and their mom and their in-laws are going to be looking for a new home, and the competition is going to be so fierce that home prices are going to have to rise,” Corcoran said.

Home prices rose at a record pace in January as more buyers came off the sidelines. And that intense competition has led to an eruption of bidding wars, often pushing prices even higher.

Data from the National Association of Realtors (NAR) shows that the average seller received 2.7 offers in the first month of the year and 16% of homes sold above asking price.

A major contributor to all this is an inventory crisis. In 2023, existing home sales reached their lowest level since 2005 as potential sellers locked into low mortgage rates stayed put.

“There’s such a shortage of housing right now, so prices have gone up even though everyone was singing the blues,” Corcoran said. “It simply happened because there are a lot of buyers and not enough houses available.”

The supply is slowly improving. New home additions rose 3.8% in February to a 17-month high, while the total supply of homes for sale rose to the highest level in a year, according to Redfin.

It’s a sign that buyers and sellers are becoming more comfortable with higher mortgage rates, said Lawrence Yun, NAR’s chief economist.

“More people are adjusting to the new normal for mortgage rates, which seems to be between 6% and 7%,” Yun said on Yahoo Finance Live. “There is a significant group of delayed sellers who have postponed and they will start listing their properties.”

While more new listings are good news for buyers, a dramatic improvement in inventory could take some time. Top economist Mark Zandi warned that the market recovery will take “several years” to materialize.

“We can say with strong conviction that the housing market has probably bottomed out in terms of home sales and demand,” Zandi explains. “All indications are that 30-year mortgage rates will likely go to 6% instead of 8%. If that’s the case, we should start to see improvement, but this is a process.”

So what should you do if you’re sitting on the sidelines, hoping that mortgage rates will drop or more homes will come onto the market? Corcoran’s advice is simple: don’t wait. She advises that ‘right now’ is always the best time to buy, and to give yourself an edge in a tight market, ‘write a love letter’ to the owners of the home you have your eye on.

“Go into a community, see which houses you like and leave love notes on every door,” says Corcoran, who suggested writing a personal message about what you like about the house, even if it’s not for sale.

“It works. The last four houses I bought were off the market. I just picked the house I liked the most and eventually people called (back),” she said.

Sean Smith is an anchor at Yahoo Finance. Follow Smit on Twitter @SeanaNSsmith. Tips about deals, mergers, activist situations or something else? Email seanasmith@yahooinc.com.

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