Sales of previously owned homes in the United States fell sharply in August, despite mortgage rates plummeting that month. But much more housing demand will likely be unleashed onto the market after the Federal Reserve finally cut interest rates this week for the first time in four years — and signaled more rate cuts by year’s end.

Sales of previously owned homes fell 2.5% from the prior month, as a recent drop in mortgage rates failed to offset home prices that remain near record highs.