The average rate for a 30-year mortgage decreased for the second consecutive week and is currently at its lowest level in over a year, a positive development for potential homebuyers encountering high home prices. Mortgage buyer Freddie Mac reported that the rate dropped to 6.35% from 6.46% the previous week, with a significant decrease from the 7.18% average rate a year ago. This marks the lowest average rate since May 11, 2023.
Moreover, borrowing costs for 15-year fixed-rate mortgages also saw a decline this week, offering good news for homeowners aiming to refinance their home loan at a reduced rate. The average rate decreased to 5.51% from the previous week’s 5.62% and significantly lower than the 6.55% average rate from a year ago, according to Freddie Mac.
Freddie Mac’s chief economist, Sam Khater, stated, “Mortgage rates fell again this week due to expectations of a Fed rate cut. Rates are expected to continue their decline, and while potential homebuyers are watching closely, a rebound in purchase activity remains elusive until we see further declines.” Signs of diminishing inflation and a cooling job market have heightened anticipations that the Federal Reserve will reduce its benchmark interest rate next month for the first time in four years.