Mortgage rates dropped to the lowest level since February 2023 this week, as the average rate for a 30-year fixed-rate mortgage fell to 6.2%, down from an average of 6.35% last week and down from 7.18% a year ago, according to Freddie Mac’s Primary Mortgage Market Survey.
“Mortgage rates have fallen more than half a percent over the last six weeks and are at their lowest level since February 2023,” says Sam Khater, chief economist for Freddie Mac, in a statement. “Rates continue to soften due to incoming economic data that is more sedate. But despite the improving mortgage rate environment, prospective buyers remain on the sidelines, as they negotiate a combination of high house prices and persistent supply shortages.”
The average rate for a 15-year fixed-rate mortgage was 5.27%, down from 5.47% last week and down from 6.51% a year ago.
Yesterday, the Mortgage Bankers Association reported that mortgage application volume increased 1.4% during the week ended September 6, as rates continued to fall.
The Fed is expected to cut rates by either 0.25 or .50 basis points at its meeting later this month. Helping to shore up that prediction is that the labor market appears to be cooling: The latest jobs report from the U.S. Bureau of Labor Statistics shows that the U.S. economy added 142,000 jobs in August – weaker growth than in previous months – while the unemployment rate remained flat at 4.2%.
Photo: Ali Rezaei