The interest rate for a 30-year mortgage rose to 7.18% this week, Freddie Mac reported Thursday, marking the fifth consecutive week above 7%. Home buyers purchasing a typical single-family existing home at the median price of $412,300 should expect a monthly mortgage payment of $2,234, says Jessica Lautz, deputy chief economist at the National Association of REALTORS®.

A year ago, when rates crossed the 6% mark for the first time since 2008, monthly payments on a home priced at $400,000 averaged $1,923. Today’s home buyers at the same $400,000 level are facing monthly mortgage payments about $245 higher, Lautz says. They’re also up against higher home prices and steep competition for a limited number of homes on the market.

NAR’s Housing Affordability Index last week hit its lowest point since July 1986. “Rate hikes have eroded housing affordability and wealth gains for potential buyers wanting to enter the market,” Lautz says.

The Federal Reserve meets next week to determine whether it will again hike its short-term benchmark rate, which could influence the direction of mortgage rates in the coming weeks. This week’s consumer price inflation report, which reflects August data, showed an uptick in the inflation rate to 3.7%. That’s still shy of the Fed’s 2% target.

“The reacceleration of inflation and strength in the economy is keeping the mortgage rates elevated,” says Sam Khater, Freddie Mac’s chief economist.

For home buyers faced with higher rates, Khater points to a Freddie Mac study showing that home purchasers who shop around and gather quotes for mortgage rates could potentially save between $600 to $1,200 annually on their loan. (Here are six ways your buyers can save on their mortgage.)

Freddie Mac reports the following national averages with mortgage rates for the week ending Sept. 14:

• 30-year fixed-rate mortgages: averaged 7.18%, rising from last week’s 7.12% average. A year ago, 30-year rates averaged 6.02%.
• 15-year fixed-rate mortgages: averaged 6.51%, falling from last week’s 6.52% average. A year ago, 15-year rates averaged 5.21%.

The interest rate for the 30-year loan reached an average of 7.09% this week, prompting more home buyers to revisit their budgets. Freddie Mac reports that mortgage rates are now at the highest averages since April 2002.

The higher rates are translating into rising monthly mortgage payments—an average of $2,234 for a single-family home and $1,942 for a condo, says Jessica Lautz, deputy chief economist at the National Association of REALTORS®. “The increased mortgage rate is exacerbating housing affordability as home prices are climbing in this limited inventory environment,” Lautz says. “Something has to give for rates to come down, and that something is the next decision by the Fed.” However, here are six ways buyers can save on their mortgage.

The Federal Reserve at its next meeting in September will decide whether to continue raising its short-term benchmark interest rate, which has been blamed for pushing up mortgage rates and other borrowing costs. The Fed has raised its rate 10 times, pausing briefly in June. Economists have called on the Fed to stop its rate increases due to improving inflation and economic data.

“The economy continues to do better than expected, and the 10-year Treasury yield has moved up, causing mortgage rates to climb,” says Sam Khater, Freddie Mac’s chief economist. “The last time the 30-year fixed-rate mortgage exceeded 7% was last November. Demand has been impacted by affordability headwinds, but low inventory remains the root cause of stalling home sales.”

Freddie Mac reports the following national averages with mortgage rates for the week ending Aug. 17:

• 30-year fixed-rate mortgages: averaged 7.09%, rising from last week’s 6.96% average. Last year at this time, 30-year rates averaged 5.13%.
• 15-year fixed-rate mortgages: averaged 6.46%, increasing from last week’s 6.34% average. A year ago, 15-year rates averaged 4.55%.

For the third consecutive week, mortgage rates were on the rise, forcing some hopeful home buyers to the sidelines. Freddie Mac’s latest nationwide survey shows the 30-year fixed-rate mortgage averaging 6.96%.

“Rates are just a sliver below 7%, and that will make it difficult not only for home buyers but also sellers considering a move,” says Jessica Lautz, deputy chief economist at the National Association of REALTORS®. The latest NAR data shows home prices increased in 60% of the nation’s largest metro areas in the second quarter, further pressing on buyers’ budgets. “Affordability challenges will continue for buyers if new inventory is not brought to the market and rates do not abate,” Lautz adds. Homeowners who locked in mortgage rates in the 2% or 3% range more than a year ago are showing reluctance to move and swap their ultra-low rate for a higher one.

“There is no doubt continued high rates will prolong affordability challenges longer than expected, particularly with home prices on the rise again,” says Sam Khater, Freddie Mac’s chief economist. “However, upward pressure on rates is the product of a resilient economy with low unemployment and strong wage growth, which historically has kept purchase demand solid.”

But first-time home buyers are finding it more difficult to get into homeownership, particularly after the rate on Federal Housing Administration loans this week surged to their highest level in more than two decades, reaching 7.02%, the Mortgage Bankers Association reports. FHA loans tend to be a draw among first-time and low-income home buyers due to their low down payment options.

As mortgage rates rise across the board, some home buyers may be forced to hit the pause button on their purchase plans. Mortgage applications for home purchases fell 3% last week and are now 27% lower than a year ago, MBA reports. Higher prices and rates, combined with historically low inventory, are proving to be major challenges to the summer homebuying season.

Freddie Mac reports the following national averages with mortgage rates for the week ending Aug. 10:

• 30-year fixed-rate mortgages: averaged 6.96%, rising from last week’s 6.9% average. A year ago, 30-year rates averaged 5.22%.
• 15-year fixed-rate mortgages: averaged 6.34%, increasing from last week’s 6.25% average. A year ago, 15-year rates averaged 4.59%.

The 30-year fixed-rate mortgage averaged 6.78% this week, backing away from its near-7% mark last week. “That relief is welcome at a time when the St. Louis Fed is reporting there are tighter lending standards now for consumers seeking mortgages,” says Jessica Lautz, deputy chief economist and vice president of research at the National Association of REALTORS®. “Simultaneously, home prices have now hit the second-highest amount recorded since January 1999.”

For a buyer purchasing a $410,200 home—the median price of an existing home in June—that translates to a mortgage payment of $2,135 at today’s mortgage rate, Lautz says. “This is out of reach for many first-time buyers, as the median qualifying income would need to be $102,480.”

Besides higher rates, buyers are up against a deep housing shortage. Thirty-three percent of homes sold above the list price in June due to housing inventory, which has hit its lowest level in four decades, Lautz says.

Many homeowners may be reluctant to sell out of fear they wouldn’t find or couldn’t afford another home in this bare market. Lower mortgage rates could help counter that somewhat, Lautz says. “While new inventory is needed, lower rates would bring current owners out of their homes they may have outgrown and into the market,” she adds. 

Here’s a closer look at mortgage rates for the week ending July 20, according to Freddie Mac’s weekly mortgage market index:

• 30-year fixed-rate mortgages: averaged 6.78%, falling from last week’s 6.96% average. A year ago, 30-year rates averaged 5.54%.
• 15-year fixed-rate mortgages: averaged 6.06%, dropping from last week’s 6.3% average. This time last year, 15-year rates averaged 4.75%.

“Borrowers should remember that an average rate isn’t the exact rate that everyone will be offered,” says Jacob Channel, senior economist at LendingTree. “Owing to this, while home buyers can generally expect lenders to offer rates near what the current average is, they should also remember that other factors like their personal credit score and income will also play a large role in the specific rate they get.” Channel urges borrowers to shop around among different lenders and gather several rate quotes.

Mortgage rates were back on the rise this week, averaging 6.96%, Freddie Mac reports. For home buyers, the rate jump is translating to an average monthly payment of $2,126 for the typical single-family home. Higher rates have pushed the typical monthly mortgage payment up more than $280, says Jessica Lautz, deputy chief economist and vice president of research at the National Association of REALTORS®.

Mortgage rates have surged to their highest level since November 2022, when they broke 7%, says Sam Khater, Freddie Mac’s chief economist. “Incoming data suggest that inflation is softening, falling to its lowest annual rate in more than two years,” he adds. “However, increases in housing costs, which account for a large share of inflation, remain stubbornly high, mainly due to low inventory relative to demand.”

The latest inflation data offers a glimmer of hope that lower mortgage rates could occur later this year, Lautz says. In June, inflation saw its smallest gain in more than two years, and consumers are noticing moderating prices for gasoline, energy and healthcare services.

Lower inflation also may enable aspiring home buyers to save more for a down payment. “It may be easier today to save and pay down existing debt than it has been in the last year,” Lautz says. “Energy prices dropped, meaning a summer road trip could still happen even while saving for a new home.”

Despite the recent uptick in rates, mortgage applications for home purchases are rising. But they’re still down 26% from a year ago, the Mortgage Bankers Association reports. “The rise in purchase activity was driven by increases in both FHA and VA purchase applications,” says Joel Kan, deputy chief economist at MBA. Both types of loans offer low down payment options. 

“Going forward, we can expect rates to continue paying a tremendous amount of attention to incoming economic data,” Matthew Graham, chief operating officer at Mortgage News Daily, told realtor.com®. “Traders are on the edge of their seats, waiting for evidence that the economy and inflation are finally cooling off in a meaningful way. When it happens, we should see a reasonably swift move back toward more livable rates.”

Freddie Mac reports the following national averages with mortgage rates for the week ending July 13:

• 30-year fixed-rate mortgages: averaged 6.96%, up from last week’s 6.81% average. A year ago, 30-year rates averaged 5.51%.
• 15-year fixed-rate mortgages: averaged 6.3%, up from last week’s 6.24% average. A year ago, 15-year rates averaged 4.67%.

The mortgage rate for a 30-year home loan averaged 6.81% this week, reaching its highest point so far this year, Freddie Mac reports. “This upward trend is being driven by a resilient economy, persistent inflation and a more hawkish tone from the Federal Reserve,” says Sam Khater, Freddie Mac’s chief economist. “These high rates, combined with low inventory, continue to price many potential home buyers out of the market.”

Mortgage applications for home purchases are fluctuating—dipping 5% last week, according to the Mortgage Bankers Association—with the movement in borrowing costs. “Rates are still over a percentage point higher than a year ago, and housing affordability is still a challenge in many parts of the country,” Joel Kan, deputy chief economist at the Mortgage Bankers Association, said in a statement. “However, the average loan size for a purchase application declined to $423,500—its lowest level since January.” This has largely been driven by a decline in home buying in high-priced markets and an increase in lower price tiers, Kan added.

Despite the week-to-week fluctuations, some home buyers may be adjusting to a new normal for mortgage rates in the 6% to 7% range, says George Ratiu, chief economist at Keeping Current Matters. Mortgage rates began climbing late last year and have stayed within that range ever since. The pace of home sales has mostly kept steady over the past few months, Ratiu says. Builders are pushing construction activity higher, too, he adds.

Freddie Mac reports the following national averages with mortgage rates for the week ending July 6:

• 30-year fixed-rate mortgages: averaged 6.81%, increasing from last week’s 6.71% average. A year ago, 30-year rates averaged 5.3%.
• 15-year fixed-rate mortgages: averaged 6.24%, rising from last week’s 6.06% average. A year ago, 15-year rates averaged 4.45%.

Despite a dip for the third consecutive week, mortgage rates are still above 6.5%—a key affordability threshold—and remain much higher than they were just two years ago. Freddie Mac reports that the 30-year fixed-rate mortgage averaged 6.67% this week. A year ago, rates averaged 5.81%, and in early 2021, they were in the 2% range.

The dramatic change in rates has created a “mortgage rate lock-in effect,” in which homeowners are reluctant to trade in their current ultra-low mortgage rate for a higher one—especially at today’s higher home prices, says Danielle Hale, realtor.com®’s chief economist. These stubborn would-be sellers are partially the reason housing inventory levels remain so low. “The vast majority of homeowners locked in low rates during the pandemic and aren't particularly excited to give them up in order to buy a new home, unless they really need to move for personal reasons,” Hale says. “The housing market has really seen a double whammy in 2023, with a retrenchment in the number of homes for sale coupled with still-high prices and mortgage rates that have kept both first-time and repeat buyers on the sidelines.”

Potential home buyers are watching rates closely to decide when to make their move, says Sam Khater, Freddie Mac’s chief economist. “However, inventory challenges persist as the number of existing homes for sale remains very low,” Khater says. “Though, a recent rebound in single-family housing starts is an encouraging development that will hopefully extend through the summer.” New data this week shows construction of single-family homes reached an 11-month high in May.

Here’s a closer look at how mortgage rates fared for the week ending June 22.

• 30-year fixed-rate mortgages: averaged 6.67%, down from last week’s 6.69% average. Last year at this time, 30-year rates averaged 5.81%.
• 15-year fixed-rate mortgages: averaged 6.03%, down from last week’s 6.10% average. A year ago, 15-year rates averaged 4.92%.

Mortgage rates decreased for the second consecutive week but still remain above 6.5%, a far cry from a year ago, muting any celebration from borrowers. Freddie Mac reports the 30-year fixed-rate mortgage averaged 6.69% this week.

The weekly drop comes on the heels of better economic news: The Federal Reserve on Wednesday voted to pause hikes to its benchmark interest rate in June—here’s how that could affect mortgage rates—and inflation dropped to 4%, the lowest level in two years.

“As inflation continues to decelerate, economic growth is slowing and the tightening cycle of monetary policy is reaching its apex, which means mortgage rates are expected to decrease later this year and into next,” says Sam Khater, Freddie Mac’s chief economist.

Indeed, the latest economic data indicates that inflation may ease even faster in the coming months, particularly as rent growth continues to cool. “With this decelerating trend in rent prices to persist in the upcoming months, inflation will slow down further, pulling down mortgage rates,” says Nadia Evangelou, senior economist and director of real estate research at the National Association of REALTORS®. “At the current mortgage rate, renters who pay $1,655 monthly for rent can spend the same amount on a monthly mortgage payment for a home with a value of $321,000.”

Freddie Mac reports the following national averages with mortgage rates for the week ending June 15:

• 30-year fixed-rate mortgages: averaged 6.69%, dropping from last week’s 6.71% average. A year ago, 30-year rates averaged 5.78%.
• 15-year fixed-rate mortgages: averaged 6.10%, rising from last week’s 6.07% average. A year ago, 15-year rates averaged 4.81%.

After recent increases, the mortgage rate for the 30-year fixed loan pulled back this week, giving home shoppers a slight reprieve on borrowing costs. Still, rates remain above 6.5% for the third consecutive week: The 30-year fixed-rate mortgage averaged 6.71% this week, Freddie Mac reports. “While elevated rates and other affordability challenges remain, inventory continues to be the biggest obstacle for prospective home buyers,” says Sam Khater, Freddie Mac’s chief economist.

A newly released report this week from the National Association of REALTORS® and realtor.com® showed that lean housing inventory continues to plague the market and has largely contributed to worsening affordability. Middle-income buyers may have it the worst, with the fewest homes on the market in their price range. “Housing markets are navigating the uncertain waters by balancing solid buyer demand—boosted by a strong job market—with lower affordability,” says George Ratiu, chief economist at Keeping Current Matters, a real estate information portal.

Mortgage rates also are contributing to the affordability conundrum, as rates are considerably higher than a year ago. As rates have moved up, mortgage applications for home purchases have fallen—not just because of reduced purchasing power but also “the ongoing lack of For Sale inventory in the market,” says Joel Kan, deputy chief economist of the Mortgage Bankers Association.

Fed Meets Next Week

The Federal Reserve will meet next week to decide whether to continue to raise its short-term benchmark rate. “While the bill to resolve the debt ceiling standoff offered a noticeable relief to capital markets, concerns linger over the Fed’s next rate decision,” Ratiu says. “Several leading members of the central bank have voiced support for a rate pause this month, giving some investors hope that rate hikes may be over.”

However, inflation continues to hover near 5%, still far from the Fed’s goal to return to the historical norm of 2%. Even if the Fed pauses its rate hikes this month, additional rate increases are likely in the second half of 2023, Ratiu says.

Mortgage rates can be influenced by the Fed’s rate but tend to follow more closely the trajectory of 10-Year Treasury notes. The spread between the 10-year Treasury note and current 30-year mortgage rates remains at an elevated level, so “expect mortgage rates to continue running in the 6% to 7% band for the next few weeks,” Ratiu says.

Freddie Mac reports the following national averages with mortgage rates for the week ending June 8:

• 30-year fixed-rate mortgages: averaged 6.71%, dropping from last week’s 6.79% average. A year ago, 30-year rates averaged 5.23%.
• 15-year fixed-rate mortgages: averaged 6.07%, falling from last week’s 6.18% average. A year ago, 15-year rates averaged 4.38%.

At 6.39% this week, the average for the 30-year fixed-rate mortgage has been settling in below the 6.5% range for some time now and is only one percentage point higher than a year ago, Freddie Mac reported Thursday. But while the outlook for borrowing costs bodes well for prospective home buyers this spring, the lack of inventory does not.

The number of homes on the market remains tight—still below pre-pandemic levels. Newly listed homes have plunged about 21% compared to a year ago, realtor.com® reported this week. “Spring is typically the busiest season for the residential housing market, and despite rates hovering in the mid-6% range, this year is no different,” says Sam Khater, Freddie Mac’s chief economist. “Interested home buyers are acclimating to the current rate environment, but the lack of inventory remains a primary obstacle to affordability.” 

Fewer homeowners are opting to sell compared to last year, and that continues to limit buyers’ choices and constrain home sales, says Danielle Hale, realtor.com®’s chief economist. A third of homeowners recently surveyed by realtor.com® say buying their next home is their top concern when evaluating whether to sell.

“Many sellers are likely future buyers, too. That may be why a majority of would-be sellers report feeling ‘locked in’ to their current home because of a low mortgage rate, especially younger homeowners,” Hale says. “But older homeowners, who are likely to have a smaller mortgage balance and greater equity, are less likely to report feeling locked in by a low interest rate and more likely to report that they need to sell anyway. This likely means that older households will continue to play a prominent role on both sides of the home sale transaction this year.”

Could Rates Move Lower?

Despite the Federal Reserve raising its benchmark rate for the tenth time—a move National Association of REALTORS® Chief Economist Lawrence Yun called “unnecessary and harmful”—mortgage rates still fell this week. So, don’t assume the Fed’s monetary policy will lead to higher mortgage rates, says Nadia Evangelou, senior economist and director of real estate research at NAR. The Fed’s rate does not have a direct correlation to mortgage rates. “If inflation keeps slowing down, then mortgage rates will move lower,” Evangelou says.

NAR has predicted 30-year rates to drop to 6% by the end of the year and to 5.6% in 2024. Mortgage rates are no longer double what they were a year ago: The 30-year loan averaged 5.27% at that time. “The gap between current and last year’s affordability is narrowing,” Evangelou says. “Home prices are modestly lower while American family income is about 6% higher than a year ago.”

Freddie Mac reports the following national averages for mortgage rates for the week ending May 4.

• 30-year fixed-rate mortgages: averaged 6.39%, falling from last week’s 6.43% average. Last year at this time, 30-year rates averaged 5.27%.
• 15-year fixed-rate mortgages: averaged 5.76%, up from last week’s 5.71% average. A year ago, 15-year rates averaged 4.52%.

After weeks of declines, the interest rate for a 30-year mortgage reversed course, jumping to a 6.39% average this week, Freddie Mac reports. “For the first time in over a month, mortgage rates moved up due to shifting market expectations,” says Sam Khater, Freddie Mac’s chief economist. “Home prices have stabilized somewhat, but with supply tight and rates stuck above 6%, affordable housing continues to be a serious issue for many potential home buyers. Unless rates drop into the mid-5% range, demand will only modestly recover.”

The sweet spot may be 5.5%—a threshold that 71% of prospective buyers say they’re unwilling to cross, according to a recent study by John Burns Real Estate Consulting. The National Association of REALTORS® forecasts that mortgage rates will drop below 6% by the end of the year.

The lift in mortgage rates this week comes after some calming in the banking sector, says Nadia Evangelou, NAR’s senior economist and director of real estate research. After recent bank closures, the economy has faced a lot of uncertainty. “Mortgage rates are expected to continue to fluctuate in the coming months, affecting both housing affordability and sales activity,” Evangelou says.

Freddie Mac reports the following national averages with mortgage rates for the week ending April 20:

• 30-year fixed-rate mortgages: averaged 6.39%, rising from last week’s 6.27% average. A year ago, 30-year rates averaged 5.11%.
• 15-year fixed-rate mortgages: averaged 5.76%, rising from last week’s 5.54%. Last year at this time, 15-year rates averaged 4.38%.

Lower mortgage rates are giving buyers a boost at the start of the spring homebuying season. The 30-year fixed-rate mortgage dropped to 6.28% this week, the fourth straight week of declines, Freddie Mac reports. While rates are still higher than they were a year earlier, they’ve gradually scaled back from a 7% peak at the end of 2022.

“Compared to the recent 7% peak, the latest rate saves $140 per month for a home buyer on a $300,000 loan,” says Lawrence Yun, chief economist for the National Association of REALTORS®. “Though week-to-week rate changes can move up and down, the longer-term prospect on rates is for further improvement, with a clear possibility of rates going under 6% by the year’s end.”

Market dynamics are setting the stage for Yun’s prediction. Robust apartment construction in recent years has led to rising vacancies, which likely will temper rent growth and inflation, Yun says. “The Federal Reserve can, therefore, stop tightening,” which could ease the pressure on mortgage rates, he adds. “With lower rates, more home buyers will steadily appear. That is why it is critical to ensure more housing supply to help meet the recovering demand.”

Housing inventory remains at historic lows. As such, even in a slower housing market compared to 2022 levels, multiple offers and bidding wars are still present in many places as buyers scramble for limited choices.

Freddie Mac reports the following national averages for mortgage rates in the week ending April 6:

• 30-year fixed-rate mortgages: averaged 6.28%, falling from last week’s 6.32% average. Last year at this time, 30-year rates averaged 4.72%.
• 15-year fixed-rate mortgages: averaged 5.64%, rising from last week’s 5.56%. A year ago, 15-year rates averaged 3.91%.

Mortgage rates continued to slide this week, adding more fuel to what appears to be a recovering housing market. The 30-year fixed-rate mortgage averaged 6.32% for the week ending March 30, Freddie Mac reported Thursday. Borrowing costs are heading down as major housing indicators, such as existing-home sales, new-home construction and contract signings for home purchases, have been on the rise for the past three months.

“Although there was some calming in the market after the recent bank shock, mortgage rates continued to drop,” says Nadia Evangelou, senior economist and director of real estate research for the National Association of REALTORS®. “Thus, buyers were able to lock in a lower rate by the end of the first quarter.”

The people most affected by shifts in mortgage rates may be baby boomers, who have edged out millennials as the top homebuying force in America, according to NAR’s recent 2023 Home Buyers and Sellers Generational Trends Report. “This demographic shift is bound to be observed in the real estate market for the next decade,” Evangelou says. “About 20 million additional households will be older than 65 by 2030. With nearly 80% of them owning their home, baby boomers have substantially more wealth than younger generations.”

But limited housing options likely will hold some would-be buyers back this spring, says Sam Khater, Freddie Mac’s chief economist. “Over the last several weeks, declining rates have brought borrowers back to the market,” he says. “But as the spring homebuying season gets underway, low inventory remains a key challenge for prospective buyers.”

Freddie Mac reported the following national averages with mortgage rates for the week ending March 30:

• 30-year fixed-rate mortgages: averaged 6.32%, down from last week’s 6.42% average. Last year at this time, 30-year rates averaged 4.67%.
• 15-year fixed-rate mortgages: averaged 5.56%, also down from last week’s 5.68% average. A year ago, 15-year rates averaged 3.83%.

© Douglas Rissing - iStock/Getty Images Plus

Mortgage rates continued to slide this week, even after recent bank failures failed to stop the Federal Reserve from hiking its benchmark interest rate for the ninth consecutive time. Mortgage rates are following the downward trend of 10-year Treasury yields, which is helping to lift homebuying demand. While the 30-year fixed-rate mortgage averaged 6.42% this week, according to Freddie Mac, mortgage applications to purchase a home rose 2% week over week, the Mortgage Bankers Association reported.

Buyers appear ready to act upon movement in mortgage rates. In February, existing-home sales posted their first monthly gain in a year—up 14.5% from January, the National Association of REALTORS® reported this week. “Conscious of changing mortgage rates, home buyers are taking advantage of any rate declines,” says NAR Chief Economist Lawrence Yun. Home prices also are stabilizing, as Yun has previously predicted, actually falling last month for the first time in more than a decade.

All of this news bodes well for a potentially robust spring real estate season. “If mortgage rates continue to slide over the next few weeks, look for a continued rebound during the first weeks of the spring homebuying season,” says Sam Khater, Freddie Mac’s chief economist.

The Fed has taken an aggressive stance toward raising its benchmark rate over the past year to fight high inflation. The Fed continued to press forward with that stance this week despite financial turmoil sparked by the closures of Silicon Valley Bank, Signature Bank and Silvergate Capital. Mortgage rates are not directly tied to the Fed’s benchmark rate but can be influenced by it.

Mortgage rates are experiencing daily fluctuations due to economic volatility and uncertainty about the stability of the banking system, says Holden Lewis, home and mortgage expert at NerdWallet. “After a couple of weeks of volatility, mortgage rates are likely to stabilize as a result of this Federal Reserve hike,” Lewis says. Still, “home buyers should accept that if they wait for interest rates to fall substantially, they might wait longer than they expect.”

Home buyers may benefit from shopping around for the best mortgage rate, given the volatility. Freddie Mac’s research shows that home buyers could potentially save $600 to $1,200 annually by taking the extra time to shop and collect quotes from multiple lenders.

Freddie Mac reported the following national averages with mortgage rates for the week ending March 23:

• 30-year fixed-rate mortgages: averaged 6.42%, down from last week’s 6.6% average. Last year at this time, 30-year rates averaged 4.42%.
• 15-year fixed-rate mortgages: averaged 5.68%, also down from last week’s 5.9% average. A year ago, 15-year rates averaged 3.63%.

Mortgage rates, which have risen more than half a percent over the last five weeks, fell this week amid fears about the sturdiness of the nation’s banking industry. Silicon Valley Bank and two others that primarily support the technology industry shuttered operations, sending shock waves through the U.S. economy.

The 30-year fixed-rate mortgage decreased to 6.6% this week, Freddie Mac reports. That means most Americans can afford to buy a median-priced home and spend less than 25% of their gross income on their monthly mortgage payment—a gauge for measuring affordability—says Nadia Evangelou, senior economist and director of real estate research at the National Association of REALTORS®.

“Rates may decrease even further in the coming weeks, depending on reactions in the financial market and the outcome of the Fed’s meeting next week,” Evangelou adds. The Federal Reserve meets next week to decide the trajectory of its short-term benchmark interest rate and whether to continue or pull back on aggressive hikes.

Mortgage rates largely follow the course of 10-year Treasury yields, which have been falling ever since the announcement of the closures of Silicon Valley Bank, Signature Bank and Silvergate Capital.

“Turbulence in the financial markets is putting significant downward pressure on rates, which should benefit borrowers in the short-term,” says Sam Khater, Freddie Mac’s chief economist. “During times of high mortgage rate volatility, home buyers would greatly benefit from shopping for additional rate quotes.”

Freddie Mac’s research shows that home buyers could potentially save $600 to $1,200 annually by taking the extra time to shop and collect quotes from multiple lenders.

Freddie Mac reports the following national averages with mortgage rates for the week ending March 16:

• 30-year fixed-rate mortgages: averaged 6.6%, dropping from last week’s 6.73% average. Last year at this time, 30-year rates averaged 4.16%.
• 15-year fixed-rate mortgages: averaged 5.9%, dropping from last week’s 5.95% average. A year ago, 15-year rates averaged 3.39%.

Mortgage rates continued to climb this week, with the 30-year loan averaging 6.73%, Freddie Mac reports. Rates began climbing more than a month ago and are now prompting concerns that they could again head back above 7%. Still, economists are largely forecasting rates to trend downward in 2023, even if there are some blips ahead.

For now, “rates may rise further in subsequent weeks, depending on how strong other economic data is,” says Nadia Evangelou, senior economist and director of real estate research at the National Association of REALTORS®. “Jobs and inflation reports, coming soon, are two of the main drivers of today’s mortgage market.”

Also, the Federal Reserve is due to meet later this month to decide whether to continue raising its short-term rate. Mortgage rates are continuing “their upward trajectory as the Federal Reserve signals a more aggressive stance on monetary policy,” says Sam Khater, Freddie Mac’s chief economist. “Overall, consumers are spending in sectors that are not interest rate-sensitive, such as travel and dining out. However, rate-sensitive sectors, such as housing, continue to be adversely affected. As a result, would-be home buyers continue to face the compounding challenges of affordability and low inventory.”

The Fed’s benchmark rate may influence mortgage rates, but it does not have a direct impact on them.

Some buyers may be nervous about mixed economic news, which could dampen the market just as the spring homebuying kicks off. “There is certainly not a one-size-fits-all answer” to when it’s the best time to buy a home, Evangelou says. “Rates are significantly higher than the previous year, but they are still considered historically low.” Plus, if inflation eases faster than expected, mortgage rates could decrease to the low 6% range in the upcoming weeks, she adds.

Meanwhile, buyer competition has cooled in recent months. “Sellers continue to be willing to negotiate, as there is still less competition in the market than a year ago,” Evangelou says. “Inventory remains tight, but there are typically about 60% more new listings during March and August than the rest of the year.”

Freddie Mac reports the following national averages in mortgage rates for the week ending March 9:

• 30-year fixed-rate mortgages: averaged 6.73%, rising from last week’s 6.65% average. A year ago, 30-year rates averaged 3.85%.
• 15-year fixed-rate mortgages: averaged 5.95%, also rising compared to last week’s 5.89% average. A year ago, 15-year rates averaged 3.09%.

Mortgage rates jumped this week, driven up by a record number of jobs and higher-than-expected inflation, says Nadia Evangelou, senior economist and director of real estate research for the National Association of REALTORS®. The 30-year fixed-rate mortgage averaged 6.32%, up from 6.12% last week, according to Freddie Mac.

While mortgage rates may see temporary increases in the coming weeks, they’re largely predicted to stabilize and remain below their most recent peak of 7.08%, which was set in mid-November 2022. “Mortgage rates could linger at around 6.5% for a few more months before heading below 6% by summer—and maybe even 5.5% by the end of the year,” says NAR Chief Economist Lawrence Yun.

Once mortgage rates dip further, expect more home buyers to return to the housing market, Yun predicts. But he warns that with inventory levels still stubbornly low, an influx of buyers looking to take advantage of falling rates could set off “another revival of multiple bidding.”

Housing makes up one of the largest components of the Consumer Price Index and accounts for about 40% of the inflation index. Inflation is staying elevated because of rising rents, Yun says. In January, renters paid 8.6% more in rent than a year earlier. “That was a big contributor to the overall consumer price inflation running at 6.4% and well above the comfort level of 2%,” Yun says. “But rent relief is on the way.”

Yun notes that apartment construction is at a 40-year high. “As these new empty units steadily reach the market, rent growth will tame,” he says. “That will also pull back the overall consumer price inflation.” The CPI likely will ease in the second quarter of this year, Evangelou notes.

Freddie Mac reports the following national averages with mortgage rates for the week ending Feb. 16:

• 30-year fixed-rate mortgages: averaged 6.32%, increasing from last week’s 6.12% average. A year ago, 30-year rates averaged 3.92%.
• 15-year fixed-rate mortgages: averaged 5.51%, up from last week’s 5.25% average. A year ago at this time, 15-year rates averaged 3.15%.

Mortgage rates ticked up slightly this week, but they continue to remain well below their November 2022 peak, which eclipsed 7%. The 30-year fixed-rate mortgage averaged 6.12% this week, according to Freddie Mac. Lower rates in the 6% range since the beginning of the year are helping to bring costs down for potential buyers. “Interested home buyers are easing their way back to the market just in time for the spring homebuying season,” says Sam Khater, Freddie Mac’s chief economist.

Many renters are now paying about the same amount in rent as they would for a monthly mortgage if they owned a $300,000 home, says Nadia Evangelou, senior economist and director of real estate research for the National Association of REALTORS®. Nearly 85% of counties in the U.S. have a median price lower than $300,000, according to NAR data.

Aspiring home buyers may also see further easing in mortgage rates over the next few weeks. “With inflation easing rates, rates will likely resume their downward trek soon,” Evangelou says. Home price growth is slowing down in many markets, too.

Freddie Mac reports the following national averages with mortgage rates for the week ending Feb. 9:

• 30-year fixed-rate mortgages: averaged 6.12%, increasing from last week’s 6.09% average. A year ago, 30-year rates averaged 3.69%.
• 15-year fixed-rate mortgages: averaged 5.25%, rising from last week’s 5.14% average. A year ago at this time, 15-year rates averaged 2.93%.

The 30-year fixed-rate mortgage is nearly a full percentage point lower than its 7.08% peak in mid-November, helping affordability and offering millions of potential home buyers to reenter the housing market.

Even as the Federal Reserve voted this week to raise its benchmark rate by another quarter of a point, mortgage rates continued to inch downward. The mortgage market likely already priced in the latest Fed rate, says Nadia Evangelou, senior economist and director of real estate research at the National Association of REALTORS®. What’s more, as inflation readings head down, the Fed hinted it would be eyeing smaller rate hikes moving forward. That could mean mortgage rates will be even less impacted by any of the Fed’s future increases, Evangelou says.

“There is finally light at the end of the tunnel for many Americans, as they now earn more than the income needed to purchase a mid-priced home,” Evangelou says. With rates now below 6.1%, many Americans earn about $5,000 more annually than the qualifying income needed to purchase a home, she adds.

The one-percentage-point reduction in mortgage rates since November will enable up to 3 million more mortgage-ready consumers to afford a $400,000 loan, the median home price, according to Freddie Mac’s research.

Freddie Mac reported the following national averages with mortgage rates for the week ending Feb. 2:

• 30-year fixed-rate mortgages: averaged 6.09%, dropping from last week’s 6.13% average. A year ago, 30-year rates averaged 3.55%
• 15-year fixed-rate mortgages: averaged 5.14% this week, down from last week’s 5.17% average. Last year at this time, 15-year rates averaged 2.77%.

The interest rate for the 30-year fixed-rate mortgage averaged 6.15% this week, according to Freddie Mac, continuing its decline from a peak of 7.08% in mid-November. Monthly mortgage payments have fallen about $300 per month in that time, says Nadia Evangelou, senior economist and director of forecasting for the National Association of REALTORS®. And that could bring more home buyers back into the market.

Though mortgage rates are still more than double what they were a year ago, less severe swings in borrowing costs lately could bring more calmness to the housing market. Plus, mortgage rates may drop even further in the coming weeks, Evangelou says.

Inflation continues to moderate, which is helping to lessen the pressure on mortgage rates, adds Sam Khater, Freddie Mac’s chief economist. “Rates are at their lowest level since September of last year, boosting both home buyer demand and homebuilder sentiment,” Khater says. “Declining rates are providing a much-needed boost to the housing market, but the supply of homes remains a persistent concern.”

Indeed, only 40% of current listings are priced at $380,000 or lower. That’s the threshold at which homeownership is out of reach to those who earn $100,000 per year, Evangelou notes. A year ago, home buyers earning at least $100,000 could afford to buy a home that was $130,000 more expensive due to lower mortgage rates. “Buyers are still dealing with weak affordability and low [housing] inventory,” Evangelou notes.

Freddie Mac reports the following national averages with mortgage rates for the week ending Jan. 19:

• 30-year fixed-rate mortgages: averaged 6.15%, further dropping from last week’s 6.33% average. A year ago, rates averaged 3.56%.
• 15-year fixed-rate mortgages: averaged 5.28%, falling from last week’s 5.52% average. A year ago, 15-year rates averaged 2.79%.

Inflation has been dropping over the past six months, and consumers can expect mortgage rates to soon follow, says Lawrence Yun, chief economist for the National Association of REALTORS®. The 30-year fixed-rate mortgage could even drop below 6%, Yun adds. That would be welcome news to home buyers who were shell-shocked by the surge in rates above 7% this fall, which prompted a sudden contraction in the housing market.

Mortgage rates have been receding over recent weeks, with the 30-year fixed-rate mortgage averaging 6.33% this week, according to Freddie Mac’s weekly survey. Since peaking in mid-November, mortgage rates have now fallen by 0.75 percentage points. “The gate is beginning to open for home buyers who got shut out in October and November when the rates went above 7%,” says Yun. “However, there is still a housing shortage and not enough listings.” That likely will keep home prices higher, economists note.

Inflation was at 6.45% in December, according to data released this week, which is down considerably from a peak of 9.1% in June 2022. “Housing inflation due to rising rents is the one major item still showing acceleration but is soon expected to come down as well,” Yun says.

Rents rose by 8.35% in December, the highest increase in more than 40 years. But recent housing data has indicated that rents have begun to fall: Realtor.com®, for example, reports that rents have dropped in many of the nation’s hottest real estate markets after rising more than 20% over the past three years. Also, robust apartment construction likely will raise rental vacancy rates, which could help further ease rental prices in the months ahead, Yun adds.

The housing market has become “hypersensitive” to weekly movements in mortgage rates, says Sam Khater, Freddie Mac’s chief economist. Mortgage applications for home purchases have experienced large swings relative to even small changes in rates, he adds. “Over the last few weeks, latent demand has been on display, with buyers jumping in and out of the market as rates move,” Khater says.

After several weeks of dropping mortgage rates, however, aspiring buyers may gain some confidence to move forward. “This downward trend of mortgage rates gives a scrap of hope for many home buyers for the months ahead,” says Nadia Evangelou, NAR’s senior economist and director of forecasting. “With a 6% rate instead of 7%, buyers pay about $2,700 less every year on their mortgage. As a result, owning a home becomes affordable to about 1.4 million more renters and 4.3 million more homeowners. This could bring more buyers back to the market, boosting demand for housing and increasing market competition.”

Freddie Mac reports the following national averages with mortgage rates for the week ending Jan. 12:

• 30-year fixed-rate mortgages: averaged 6.33%, dropping from last week’s 6.48% average. A year ago, 30-year rates averaged 3.45%.
• 15-year fixed-rate mortgages: averaged 5.52%, also dropping from last week’s 5.73% average. A year ago, 15-year rates averaged 2.62%.

Mortgage rates likely will settle below 6% and experience less volatility this year, predicts Nadia Evangelou, senior economist and director of forecasting at the National Association of REALTORS®. But we’re not there yet: The 30-year fixed-rate mortgage averaged 6.48% this week, according to Freddie Mac. “Although rates remain more than double a year ago, they will likely stabilize as inflation will continue to slow down in the coming months,” Evangelou says.

Mortgage rates have been pulling back ever since surging to a 7.08% average in November. But the housing market may still be adjusting to higher rates; a year ago, the 30-year rate averaged 3.22%. “Mortgage application activity sunk to a quarter-century low this week as high mortgage rates continue to weaken the housing market,” says Sam Khater, Freddie Mac’s chief economist. “While mortgage market activity has significantly shrunk over the last year, inflationary pressures are easing and should lead to lower mortgage rates in 2023.”

Until then, home buyers may be in wait-and-see mode. Affordability has been hammered by higher rates in recent months. Evangelou says the qualifying income for homeownership is now near the $100,000 threshold, which means only 32% of all households and 15% of all renters can afford to buy a median-priced home. The majority of these households are Gen Xers, whose median age is 51, she adds.

But many aspiring buyers from younger generations are still waiting to jump in. “Home buyers are waiting for rates to decrease more significantly, and when they do, a strong job market and a large demographic tailwind of millennial renters will provide support to the purchase market,” says Khater. “Moreover, if rates continue to decline, borrowers who purchased in the last year will have opportunities to refinance into lower rates.”

Freddie Mac reported the following national averages with mortgage rates for the week ending Jan. 5:

• 30-year fixed-rate mortgages: averaged 6.48%, up from last week’s 6.42% average. A year ago, 30-year rates averaged 3.22%.
• 15-year fixed-rate mortgages: averaged 5.73%, also up from last week when they averaged 5.68%. A year ago at this time, 15-year rates averaged 2.43%.

Mortgage rates have been moderating over the past six weeks, declining significantly after hitting a 7.08% high last month. The 30-year fixed-rate mortgage is settling into the 6% range, averaging 6.27% this week, Freddie Mac reports.

Homeownership has become nearly 10% more affordable in this time as rates have eased. The average monthly mortgage payment for a median-priced home has fallen to $2,140, Nadia Evangelou, senior economist and director of forecasting for the National Association of REALTORS®, writes on the association’s blog. “Unless inflation surprises with an upswing, mortgage rates will move closer to 6% at the beginning of the next year, bringing more buyers back to the market,” Evangelou notes.

But will buyers find enough homes on the market? For now, potential sellers appear hesitant to list their homes, adds Sam Khater, Freddie Mac’s chief economist. “Many of those homeowners are carefully weighing their options, as more than two-thirds of current homeowners have a fixed mortgage rate below 4%,” Khater says.

Mortgage rates are about double what they were a year ago. As such, home sales activity is declining. Still, yearly activity is only 4% lower than the historical average, Evangelou says. Freddie Mac reports the following national averages with mortgage rates for the week ending Dec. 22:

• 30-year fixed-rate mortgages: averaged 6.27%, down from last week’s 6.31% average. Last year at this time, 30-year rates averaged 3.05%.
• 15-year fixed-rate mortgages: averaged 5.69%, rising from last week’s 5.54% average. A year ago, 15-year rates averaged 2.30%.