The average interest rate on a 30-year mortgage in the United States fell to 6.64% for the second week in a row, Freddie Mac announced Thursday. This modest decline is a welcome boost for prospective homebuyers during the spring homebuying season.
Compared to last year, the current rate of 6.64% is lower than its average of 6.82%. Since mid-January, mortgage rates have trended downward, reducing borrowing costs and increasing buyers’ purchasing power.
The decline in mortgage rates is linked to factors such as inflation expectations, global demand for US Treasuries, and the Federal Reserve’s interest rate policy decisions. The current drop in mortgage rates follows moves in the 10-year Treasury yield, which lenders use to price home loans.
According to Joel Berner, senior economist at Realtor.com, the recent decline in mortgage rates is expected to continue as investors exit the stock market due to concerns about a potential economic slowdown. Berner believes that lower mortgage rates will help spur home sales by making homeownership more affordable.
However, despite the easing of mortgage rates, rising home prices are driving up the cost of homeownership. The typical monthly payment made by US homebuyers reached a record-high $2,802 in recent weeks, according to Redfin.
Source: https://apnews.com/article/mortgage-rates-housing-interest-financing-home-a280c5075139dca518f97d964cae559d