Interest Rates and Real Estate in the Gulf South

In September, the Federal Reserve lowered its benchmark interest rate to a target range of 4.00-4.25%. The cut may seem small, following a previous range of 4.25-4.5%, but it marks an important shift after two years of higher borrowing costs. For real estate in the Gulf South, this change is more than a headline. It affects how homes are bought and sold, how investors look at deals, and how property owners plan for the future.

The adjustment is already showing up in the mortgage market. In Louisiana, 30-year fixed rates are now averaging around 6.3%, the lowest level in nearly a year. Buyers who were priced out earlier may find themselves back in the market, while current homeowners are starting to revisit refinancing. The savings from a reduced payment can make a meaningful difference in a household budget.

Commercial real estate (CRE) covers everything from office buildings to industrial facilities. It impacts many business sectors and local networks. A lower cost of borrowing can shift decisions in several ways:

“Lower borrowing costs can make properties more valuable,” says Chris Robertson Jr., Senior Real Estate Analyst. At the same time, local conditions still play a critical role in valuations. In our area, the risk of hurricanes and other regional risks can significantly affect property values and drive up insurance costs. Chris works closely with clients to evaluate these factors, structure financing appropriately, and identify opportunities where market conditions and risk align to create the best possible deal.

The residential market also reacts quickly to rate shifts. Buyers are finding their budgets stretch further than they did just a few months ago, though limited supply in many neighborhoods keeps competition high. Sellers may benefit from this increased demand, but pricing still matters. Homes that are well-maintained and realistically listed will attract the most attention.

For current homeowners, the decision often comes down to refinancing. Those who bought during the recent period of higher rates may now see a chance to reduce monthly payments. The right choice depends on individual circumstances, including closing costs and long-term plans, but for many households the savings are significant enough to make a refinance worth pursuing.

Shifts in interest rates also matter behind the scenes, especially for property owners and managers:

Several factors will shape the months ahead. The 10-year Treasury yield remains the biggest driver of mortgage rates, while inflation data will guide the Federal Reserve’s next moves. In the Gulf South specifically, local vacancy rates, absorption levels, and the rising cost of insurance all play a large role in how values and leasing activity unfold.

Lower interest rates are opening doors in real estate, but success will depend on making careful, informed moves.

We view shifts like this as a chance to help our clients realign strategy. Our commercial brokerage team guides investors and business owners through opportunities as they emerge. We provide dedicated support for retail landlords and retail tenants, and our office specialists work with both sides of the table to structure agreements that reflect today’s financing realities. For those focused on capital markets, our investment team helps evaluate portfolios and position assets for the cycle ahead.

Beyond brokerage, our property management and construction management services focus on asset performance and long-term value. On the residential side, our team works with buyers and sellers navigating affordability as rates shift.

The market will continue to change, but having the right information and a trusted partner makes all the difference. Our team is here to help you weigh your options and move forward with confidence.