Average U.S. 30-Year Mortgage Rate Falls to 7.24%, the Lowest in Over a Month

The benchmark 30-year fixed mortgage rate eased to 7.24% from 7.32% the previous week, Freddie Mac said.

By MATT OTT, AP Business Writer

WASHINGTON (AP) — The average long-term U.S. mortgage rate has fallen for a second consecutive week and is now at its lowest point in more than a month.

The average rate on a 30-year fixed mortgage dropped to 7.24% from 7.32% the week before, mortgage buyer Freddie Mac reported. A year earlier, the figure stood at 6.17%.

Rates on 15-year fixed mortgages, which are often used by homeowners refinancing their loans, also moved lower. The average slipped to 6.60% from 6.68% a week earlier. A year ago, it was 5.41%.

Lower mortgage rates ease some of the burden on would-be homebuyers coping with high borrowing costs.

Home loan rates are shaped by inflation, Federal Reserve policy and investors’ outlook for the economy, among other influences. They usually track the 10-year Treasury yield, which lenders use as a benchmark when pricing mortgages.

Mortgage rates had been rising since late February, when the U.S. war with Iran began, lifting oil prices and adding to inflation. The increase also reflected sharper bond-market swings, which pushed U.S. Treasury yields higher.

The 10-year Treasury yield has mostly drifted lower this month after reaching its highest level since 2002. As a result, the average 30-year mortgage rate has eased modestly after hitting 7.4% earlier this month, its highest point in nearly three years.

At midday in the bond market, the yield stood at 4.98%. It had climbed above 5.30% earlier this month and remains far above the 3.97% level seen before the war with Iran.

U.S. home sales have remained sluggish this year, largely because higher mortgage rates can add hundreds of dollars a month to borrowers’ costs, weakening buying power and causing many prospective buyers to delay purchasing a home.

In late February, the average 30-year mortgage rate briefly fell to 5.98%, its lowest reading since late 2022. Since then, the increase in rates has added about $350 to the monthly payment on a $400,000 home loan, using the latest average.

Depending on income, credit history and other factors, individual borrowers may qualify for a 30-year mortgage rate that is above or below the average.

The U.S. housing market has been in a slump since 2022, when mortgage rates began rising from pandemic-era lows. Sales of previously occupied homes were essentially unchanged last year, remaining at a 30-year low.