Average 30-Year Mortgage Rate Dips to 6.64% for Second Consecutive Week
Mortgage Rates Update: The average U.S. mortgage rate on a 30-year fixed loan has fallen to 6.64%, marking the second consecutive week of declines, according to Freddie Mac. This modest decrease comes at a crucial time for prospective homebuyers, offering some relief amid the spring homebuying season.
Current Mortgage Rates Trends
- The 30-year rate fell from 6.65% last week to 6.64% this week.
- One year ago, the rate was 6.82%, reflecting a moderate decline over the past 12 months.
- 15-year fixed mortgage rates, which are popular for homeowners looking to refinance, also dropped from 5.89% to 5.82%.
- Peaked at over 7% in mid-January 2025 but have gradually declined since then.
Lower rates increase homebuyers’ purchasing power, making homes slightly more affordable despite still-high home prices.
Why Are Mortgage Rates Dropping?
Rates are influenced by multiple economic factors, including:
- The 10-Year Treasury Yield – This is a key benchmark that lenders use to price home loans.
- In mid-January 2025, the yield was near 4.8%, but it has since dropped to 4.06%.
- As the Treasury yield falls, mortgage rates typically follow.
- Economic Uncertainty and Tariffs
- The Trump administration’s latest round of tariffs has sparked economic concerns.
- A sharp sell-off on Wall Street has increased expectations that the Federal Reserve may cut interest rates if the economy slows.
- Investors are moving out of stocks and into bonds, causing bond yields—and mortgage rates—to fall.
- Federal Reserve’s Interest Rate Policy
- The Fed’s monetary policy plays a crucial role in setting borrowing costs.
- While the Fed has held rates steady, market conditions may force a rate cut later this year, further impacting mortgage rates.
🏡 “The 10-year Treasury has dipped even further this morning as investors are exiting the stock market, so it’s likely that mortgage rates will continue to come down in the coming months,” said Joel Berner, senior economist at Realtor.com.
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Will Lower Rates Boost Home Sales?
Lower rates can make homeownership more affordable, but economic uncertainty may still dampen buyer demand.
Key Housing Market Trends to Watch:
- Easing rates and increased housing inventory helped drive home sales higher in February 2025 compared to the previous month.
- However, year-over-year home sales are still down, reflecting the broader housing slump that started in 2022.
- The average monthly mortgage payment has hit a record-high $2,802 as rising home prices continue to offset the benefits of lower mortgage rates.
- Some buyers remain hesitant due to concerns over job security and stock market fluctuations.
🏠 “It remains to be seen whether relief from mortgage rates will spur buyers to make a move in 2025, or if the broader economic conditions will slow things down,” Berner noted.
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Final Thoughts
With these rates easing, prospective buyers have more flexibility in their home purchase decisions. However, rising home prices and economic uncertainties tied to tariffs and market conditions remain key factors to watch.
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