Introduction to the Current Mortgage Rate Trend
The average rate on a 30-year mortgage in the U.S. has seen a decline for the third consecutive week, presenting a positive outlook for prospective homebuyers during the traditionally busy housing market season.
By ALEX VEIGA, AP Business Writer
The Decline in Mortgage Rates
The rate fell to 6.62% from 6.64% last week, according to mortgage buyer Freddie Mac. This decrease is significant, especially when compared to the rate from a year ago, which averaged 6.88%. The average rate has mostly trended lower since reaching just over 7% in mid-January. When mortgage rates decline, they boost homebuyers’ purchasing power.
Factors Influencing Mortgage Rates
Mortgage rates are influenced by several factors, including global demand for U.S. Treasurys, the Federal Reserve’s interest rate policy decisions, and bond market investors’ expectations for future inflation. The average rate on a 30-year mortgage loosely follows moves in the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
Impact on Homebuyers and the Housing Market
The yield, which has mostly fallen this year after climbing to around 4.8% in mid-January, has been volatile of late as bond investors reacted to the Trump administration’s decision to escalate U.S. tariffs on goods imported from nations around the world. The latest drop in mortgage rates partially reflects the bond market’s uncertainty over the Trump administration’s on-again, off-again tariff policy, which is likely to keep mortgage rates volatile, said Lisa Sturtevant, chief economist at Bright MLS.
Borrowing Costs on 15-Year Fixed-Rate Mortgages
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, were unchanged from last week. The average rate remained at 5.82%, but is down from 6.16% a year ago, Freddie Mac said.
Market Trends and Forecasts
Recent forecasts by housing economists generally called for the average rate on a 30-year mortgage to remain around 6.5% this year. The U.S. housing market has been in a sales slump since 2022, when mortgage rates began to climb from pandemic-era lows. Sales of previously occupied U.S. homes fell last year to their lowest level in nearly 30 years. Easing mortgage rates and more homes on the market nationally helped drive sales higher in February from the previous month, though they were down year-over-year.
Conclusion
The decline in the average rate on a 30-year mortgage to 6.62% presents a window of opportunity for prospective homebuyers. With more homes on the market and potentially lower asking prices in some areas, this spring homebuying season may offer more favorable conditions for those looking to purchase a home. However, the uncertainty surrounding mortgage rates and the overall economy may make it challenging for buyers to decide when to act.
FAQs
- Q: What is the current average rate on a 30-year mortgage?
- A: The current average rate on a 30-year mortgage is 6.62%.
- Q: How do changes in mortgage rates affect homebuyers?
- A: When mortgage rates decline, they boost homebuyers’ purchasing power, making homes more affordable.
- Q: What factors influence mortgage rates?
- A: Mortgage rates are influenced by global demand for U.S. Treasurys, the Federal Reserve’s interest rate policy decisions, and bond market investors’ expectations for future inflation.
- Q: Are there any forecasts for mortgage rates for the rest of the year?
- A: Recent forecasts suggest that the average rate on a 30-year mortgage is expected to remain around 6.5% for the year.
- Q: How has the housing market been performing?
- A: The U.S. housing market has been in a sales slump since 2022 but has shown signs of improvement with easing mortgage rates and more homes on the market.
Originally Published: April 10, 2025 at 12:35 PM EDT
- A: The U.S. housing market has been in a sales slump since 2022 but has shown signs of improvement with easing mortgage rates and more homes on the market.
