The Federal Reserve cut interest rates by 50 basis points and Chairman Jerome Powell said the central bank expects the housing market to normalize, as will interest rates.

Compass Real Estate agents Tom Postilio and Mickey Conlon join Josh Lipton on Asking for a Trend to discuss what the rate cut means for the U.S. real estate market.

Postilio tells Yahoo Finance that the real estate sector is “popping the champagne bottle because there’s just been a lot of headwinds over the last three years,” but that “the half point is big news.”

“August is normally a slow month (but this year) it was absolutely crazy,” says Conlon, who explains that there is typically less interest in buying a home in the fall, especially right before the presidential election.

“We got to work right away, all in preparation for today’s announcement,” because it seems people have put aside any concerns about the election, “because there is so much pent-up demand and there has been for three years” and “this announcement gave (buyers) permission to step off the fence,” Conlon said.

Postilio notes that this increase in demand activity is “across the board,” but the luxury sector stands out. Compass Real Estate saw the most signed contracts in the week after Labor Day in nearly two decades, he reports.

“Low supply and high interest rates” are “an absolute disaster for first-time home buyers because they are priced out of the market,” Conlon notes, suggesting the rate cut could help alleviate these challenges.

For more expert insights and the latest market moves, click here to watch the full episode of Asking for a Trend.

This post was written by Naomi Buchanan.