The average rate on a 30-year mortgage in the U.S. edged lower for the second week in a row, a modest but welcome boost for prospective home shoppers in the midst of the spring homebuying season.
The rate fell to 6.64% from 6.65% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.82%.
The average rate has mostly trended lower since reaching just over 7% in mid-January. When mortgage rates decline, they boost homebuyers’ purchasing power.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell this week, pulling the average rate down to 5.82% from 5.89% last week. A year ago, it averaged 6.06%, Freddie Mac said.
Mortgage rates are influenced by factors including bond market investors’ expectations for future inflation, global demand for U.S. Treasurys and the Federal Reserve’s interest rate policy decisions.
The overall decline this year in the average rate on a 30-year mortgage loosely follows moves in the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
The yield, which was nearing 4.8% in mid-January, has mostly fallen since then, amid signs that the economy is slowing and worries that tariffs imposed by the Trump administration on goods imported from around the globe could hurt economic growth and fuel inflation.
The yield slid to 4.06% Thursday as a sharp sell-off on Wall Street following the White House’s latest and most severe volley of tariffs fueled expectations among bond investors that the Fed may have to cut its main interest rate if the economy sours.
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