The latest data from the U.S. Federal housing mortgage company Freddie Mac shows that this week, the average 30-year fixed-rate mortgage has dropped to 6.01%, lower than last week’s 6.09% and also lower than the 6.85% from a year ago.
The cost of borrowing for the popular 15-year mortgage, favored by those seeking to refinance their homes, has also fallen to 5.35%, reaching its lowest level since October 2024.
This rate cut comes after a recent decline in the 10-year U.S. Treasury bond yield, as mortgage rates are closely tied to government bond yields.
Sam Khater, the Chief Economist at Freddie Mac, mentioned that “the low-interest rate environment not only increases the affordability for potential homebuyers but also strengthens the financial situation of homeowners.”
He pointed out that refinancing applications have more than doubled in the past year, allowing recent homebuyers to reduce their annual mortgage repayments by thousands of dollars.
In the first half of 2025, long-term mortgage rates were hovering around 7%. However, in July, as expectations of a Federal Reserve rate cut increased, long-term mortgage rates began to decline.
Despite this, potential homebuyers are currently in a wait-and-see mode.
According to data from the National Association of Realtors (NAR), sales of existing homes in January decreased by 8.4% compared to the previous month, marking the largest monthly decline in nearly four years.
The cold winter weather may be one of the reasons for the slowdown in sales, but rising prices have also played a role. In a tight supply situation, the median sales price for existing homes soared to a record high of $396,800 in January.
NAR’s data indicates that the rising median price signifies the 31st consecutive month of year-over-year price increases.
Forecasts from major housing market prediction firms suggest that the average 30-year fixed-rate in 2026 will hover around 6%, indicating limited further relief measures.
Senior economist at Realtor.com, Jake Krimmel, warned that even if rates continue to drop, supply shortages may offset the desired increase in homebuying affordability.
He stated, “If the ‘lock-in effect’ of mortgages (where homeowners are reluctant to sell and buy new homes due to higher rates) is not alleviated and supply does not rebound significantly, lower rates may only reignite competition, leading to price surges.”
(This article references a report from Congress Hill News.)