T
he housing market is showing signs of life after the Federal Reserve's decision to cut interest rates, but it's not yet a full-blown rally. Mortgage applications are up, with refinances leading the way, according to the Mortgage Bankers Association. The 30-year fixed-rate mortgage averaged 6.08% this week, down slightly from last week's 6.09%, while the 15-year fixed-rate ticked up to 5.16%.

    Homebuyer demand is also increasing, with Redfin's homebuyer demand index rising 1% for the four weeks ending September 22, the first increase in nearly a year. However, pending sales were quiet in August, rising only 0.6%, according to the National Association of Realtors.

    Inventory is improving, with new listings up 7.6% compared to last year and active listings up 18.1%. The median asking price has also risen 5.4% year-over-year. But there are still challenges for sellers, with 48% of all home listings going "extra stale," sitting unsold after 60 days on the market.

    Experts say that while lower mortgage rates typically boost sales, this year's trend is opposite, with sales dropping and homes sitting longer on the market. The Federal Reserve's rate cut may give buyers more confidence, but it remains to be seen if sales will pick up in the slower fall season. Many potential homebuyers are waiting for further rate decreases before making a move.