Lenders reduce extended housing loans, reaching annual bottom
U.S. mortgage rates declined this week, according to data released Thursday by Freddie Mac. The average rate for a 30-year fixed mortgage fell to 6.19% from 6.23% the prior week, marking the second consecutive weekly decrease following three weeks of increases.
The current rate is the lowest since October 30, when it reached 6.17%. Fifteen-year mortgage rates also decreased to 5.44% from 5.51% last week; they averaged 5.96% a year earlier.
Rate movements correlate with federal monetary policy and trends in the 10-year Treasury yield, which stood at 4.1% midday Thursday, up from approximately 4.0% last Wednesday.
Lower borrowing costs have boosted buyer purchasing power and contributed to a fourth consecutive monthly rise in U.S. home resales during October. However, high property prices and economic uncertainties continue to limit affordability for many potential homeowners.
The Federal Reserve reduced its key interest rate in September and October, with another cut anticipated next week. Historical patterns show that central bank reductions do not always result in immediate mortgage rate declines, as seen in late 2023 when rates rose despite Fed action.