US mortgage rates have eased for the third consecutive week, providing a welcome trend for prospective homebuyers who face elevated borrowing costs in the housing market. According to Freddie Mac, the average rate on a 30-year US mortgage fell to 6.81% from 6.84% last week.
The decline is attributed to the Federal Reserve’s interest rate policy decisions and bond market investors’ expectations for the economy and inflation. The 10-year Treasury yield, which lenders use as a guide to pricing home loans, was at 4.35% midday Wednesday, down from 4.58% just a few weeks ago.
The average mortgage rate has remained relatively close to its high so far this year but briefly dipped to 6.62% in early April. With the latest decline, the rate is now back to where it was in mid-May, reflecting a recent pullback in bond yields.
High mortgage rates have been a drag on the US housing market since 2022, when they began to climb from pandemic-era lows. Sales of previously occupied homes sank to their lowest level in nearly 30 years last year, and sales remain weak this year.
The decline in mortgage rates may provide some relief for homebuyers, but elevated borrowing costs are also affecting the new-home market. Homebuilders broke ground on fewer homes than expected last month, according to government data, and a closely watched measure of homebuilder sentiment sank to its third-lowest reading since 2012.
Source: https://abcnews.go.com/Business/wireStory/average-long-term-us-mortgage-rate-eases-681-122975189