Mortgage rates dropped sharply Tuesday, as investors in mortgage-backed bonds seemed to buy in ahead of a widely expected rate cut by the Federal Reserve.

The average rate on the 30-year fixed mortgage dropped 12 basis points from Monday to 6.13%, according to Mortgage News Daily. That is the lowest level since late 2022.

“The overall set-up is reminiscent of September 2024 when rates were doing the same thing for the same reasons ahead of Fed meeting with a virtual 100% chance of a rate cut,” said Matthew Graham, chief operating officer of Mortgage News Daily. “Back then, mortgage rates moved paradoxically higher after the Fed rate cut. The same thing could happen this time, but it’s by no means guaranteed.”

It also follows historical trends. In a video podcast for CNBC’s Property Play, Willy Walker, CEO of commercial real estate firm Walker & Dunlop said there have been similar trends in the past.

“If you go back to 1980 and the nine Fed rate cut periods over that 45-year period, the ones where the Fed cuts in a recessionary environment end up pulling down the long end of the curve, pull down the 10-year, pull down the 5-year,” Walker said. “In those where it’s not a recession, which is like right now, it does not impact long-term rates. And so as much as I’m expecting us to see at least a 25 basis point cut, and then probably another 25 basis point cut, even if you take 50 basis points out of the short end of the curve, I don’t expect it’s going to impact the long end of the curve very much.”

He added that he thinks yields are well below where they will be two or three weeks from now.

“I don’t try to predict where rates are going, but I think people … might buy on the rumor and sell on the news. I think you probably see the 10-year sell off a little bit after the Fed actually announces their 25 basis point cut,” Walker said.