Mortgage rates fell for the fourth straight week, according to
data. The average 30-year fixed mortgage rate has now fallen nearly one percentage point since its 2022 highs.
The average interest rate on a 30-year fixed-rate mortgage was 6.09% as of Thursday, the lowest since early September, the data showed. As measured by Freddie Mac, the weekly mortgage rate average climbed through much of 2022, peaking at 7.08% late last year.
The latest Freddie Mac report follows a Federal Reserve press conference on Wednesday that helped send bond yields lower. The 10-year Treasury yield, with which mortgage rates often move, fell a preliminary 0.15 percentage point this week, according to Dow Jones Market Data.
“The Federal Reserve controls short-term rates, but long-term rates, including 30-year mortgage rates are a function of market expectations for the path of the economy,” Mortgage Bankers Association Chief Economist Mike Fratantoni said in a statement, Barron’s previously reported. “Investors are betting that the economic slowdown and the Fed’s eventual victory over inflation will result in lower rates over time.”
The decline in mortgage rates from 2022’s peak can translate into savings for potential home buyers. All else equal, the buyer of a $400,000 home would save roughly $200 a month with a 6.09% mortgage compared to a 7.08% loan.
It also widens the pool of eligible borrowers, Sam Khater, Freddie Mac’s chief economist, said in a statement. “This one percentage point reduction in rates can allow as many as three million more mortgage-ready consumers to qualify and afford a $400,000 loan, which is the median home price,” he said.
Despite the decline, mortgage rates remain well above their level one year ago. This week’s average rate was 2.54 percentage points higher than the same week in 2022, according to Freddie Mac.
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