Please ensure Javascript is enabled for purposes of website accessibility
Long-Term Mortgage Rates Ease for Third Straight Week, Dipping to Just Below 7%
gvw_ap_news
By Associated Press
Published 4 weeks ago on
May 23, 2024

The average rate on a 30-year mortgage dipped below 7% for the first time since mid-April, providing a slight relief for homebuyers in a market affected by rising prices and limited properties. (AP/Nam Y. Huh)

Share

Getting your Trinity Audio player ready...

LOS ANGELES — The average rate on a 30-year mortgage dipped this week to just below 7% for the first time since mid April, a modest boost for home shoppers navigating a housing market dampened by rising prices and relatively few available properties.

The rate fell to 6.94% from 7.02% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.57%.

Third Straight Weekly Decline

This is the third straight weekly decline in the average rate. The recent pullbacks follow a five-week string of increases that pushed the average rate to its highest level since November 30. Higher mortgage rates can add hundreds of dollars a month in costs for borrowers, limiting homebuyers’ purchasing options.

Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also declined this week, trimming the average rate to 6.24% from 6.28% last week. A year ago, it averaged 5.97%, Freddie Mac said.

Factors Influencing Mortgage Rates

Mortgage rates are influenced by several factors, including how the bond market reacts to the Federal Reserve’s interest rate policy and the moves in the 10-year Treasury yield, which lenders use as a guide to pricing home loans.

Treasury yields have largely been easing since Federal Reserve Chair Jerome Powell said earlier this month that the central bank remains closer to cutting its main interest rate than hiking it.

Still, the Fed has maintained it doesn’t plan to cut interest rates until it has greater confidence that price increases are slowing sustainably to its 2% target.

Until then, mortgage rates are unlikely to ease significantly, economists say.

Impact on Homebuyers

After climbing to a 23-year high of 7.79% in October, the average rate on a 30-year mortgage stayed below 7% this year until last month. Even with the recent declines, the rate remains well above where it was just two years ago at 5.25%.

Last month’s rise in rates were an unwelcome development for prospective homebuyers in the midst of what’s traditionally the busiest time of the year for home sales. On average, more than one-third of all homes sold in a given year are purchased between March and June.

Sales of previously occupied U.S. homes fell in March and April as home shoppers contended with rising mortgage rates and prices.

This month’s pullback in mortgage rates has spurred a pickup in home loan applications, which rose last week by 1.9% from a week earlier, according to the Mortgage Bankers Association.

“May has been a better month for the mortgage market, with the last three weeks showing declining mortgage rates and increasing applications,” said MBA CEO Bob Broeksmit. “Rates below 7% are good news for prospective buyers, and MBA expects them to continue to inch lower this summer.”

RELATED TOPICS:

DON'T MISS

Quiet Administrative Change Advances Far-Right Israeli Minister’s Effort to Control West Bank

DON'T MISS

NYC Audit Says Shotspotter Gunfire Detection System Is a Waste of Money

DON'T MISS

Ohtani Hits 21st Homer, Smith and Freeman Also Go Deep in Dodgers’ Victory Over Rockies

DON'T MISS

Give-and-Take Between Dyer & Council Yields a Fresno Budget. What’s In It?

DON'T MISS

This Giant Freshwater Fish — North America’s Largest — Gains California Protection

DON'T MISS

Superstar Boxer Canelo Alvarez Will Speak at Hispanic Foundation Gala at Table Mountain

DON'T MISS

California’s Budget Process Has Once Again Become Secretive and Needs Reform

DON'T MISS

Scorching Temperatures Will Raise Heat Risk This Weekend. How Hot Will It Get?

DON'T MISS

Hanford Hospital Settles With State AG in Controversial Stillbirth Cases

DON'T MISS

Kern Pistachio Grower Ordered to Pay $30 Million in Groundwater Pumping Case

UP NEXT

Ohtani Hits 21st Homer, Smith and Freeman Also Go Deep in Dodgers’ Victory Over Rockies

UP NEXT

Give-and-Take Between Dyer & Council Yields a Fresno Budget. What’s In It?

UP NEXT

This Giant Freshwater Fish — North America’s Largest — Gains California Protection

UP NEXT

Superstar Boxer Canelo Alvarez Will Speak at Hispanic Foundation Gala at Table Mountain

UP NEXT

California’s Budget Process Has Once Again Become Secretive and Needs Reform

UP NEXT

Hanford Hospital Settles With State AG in Controversial Stillbirth Cases

UP NEXT

Kern Pistachio Grower Ordered to Pay $30 Million in Groundwater Pumping Case

UP NEXT

Donald Sutherland, Iconic Actor of ‘M.A.S.H.’ and ‘Hunger Games,’ Dies at 88

UP NEXT

California Voters Lose a Shot at Checking State and Local Tax Hikes at the Polls

UP NEXT

The Supreme Court Upholds a Tax on Foreign Income Over a Challenge Backed by Business Interests

Give-and-Take Between Dyer & Council Yields a Fresno Budget. What’s In It?

12 hours ago

This Giant Freshwater Fish — North America’s Largest — Gains California Protection

14 hours ago

Superstar Boxer Canelo Alvarez Will Speak at Hispanic Foundation Gala at Table Mountain

14 hours ago

California’s Budget Process Has Once Again Become Secretive and Needs Reform

14 hours ago

Scorching Temperatures Will Raise Heat Risk This Weekend. How Hot Will It Get?

14 hours ago

Hanford Hospital Settles With State AG in Controversial Stillbirth Cases

15 hours ago

Kern Pistachio Grower Ordered to Pay $30 Million in Groundwater Pumping Case

15 hours ago

Tulare County Bust Uncovers Large Cache of Illegal Guns and Drugs

15 hours ago

Former Fresno Council Candidate, Business Partner Convicted in Multi-Million Dollar Fraud

16 hours ago

Donald Sutherland, Iconic Actor of ‘M.A.S.H.’ and ‘Hunger Games,’ Dies at 88

17 hours ago

Quiet Administrative Change Advances Far-Right Israeli Minister’s Effort to Control West Bank

Israel is putting key responsibilities in the occupied West Bank under an administrator who answers to a hard-line government minister, Beza...

10 hours ago

10 hours ago

Quiet Administrative Change Advances Far-Right Israeli Minister’s Effort to Control West Bank

11 hours ago

NYC Audit Says Shotspotter Gunfire Detection System Is a Waste of Money

11 hours ago

Ohtani Hits 21st Homer, Smith and Freeman Also Go Deep in Dodgers’ Victory Over Rockies

12 hours ago

Give-and-Take Between Dyer & Council Yields a Fresno Budget. What’s In It?

14 hours ago

This Giant Freshwater Fish — North America’s Largest — Gains California Protection

14 hours ago

Superstar Boxer Canelo Alvarez Will Speak at Hispanic Foundation Gala at Table Mountain

14 hours ago

California’s Budget Process Has Once Again Become Secretive and Needs Reform

14 hours ago

Scorching Temperatures Will Raise Heat Risk This Weekend. How Hot Will It Get?

MENU

CONNECT WITH US

Search

Send this to a friend