Mortgage rates dipped for the second week in a row. This slight decline pushed more buyers into the market, a sign of pent-up demand despite the affordability struggles in housing.
Freddie Mac’s latest survey showed the average rate on a 30-year fixed mortgage dropped to 6.69%. That’s the lowest it’s been since October. Last week, it was 6.81%, and a year ago, it stood at 7.03%.
Many potential buyers and sellers are watching rates closely. Around 80% of mortgage holders currently have rates below 5%, according to a Zillow survey conducted earlier this year.
"This week, mortgage rates decreased to their lowest level in over a month," said Sam Khater, Freddie Mac’s chief economist. "Despite just a modest drop in rates, consumers clearly have responded as purchase demand has noticeably improved. The responsiveness of prospective homebuyers to even small changes in rates illustrates that affordability headwinds persist."
The 15-year fixed mortgage rate also declined, dropping to 5.96% from 6.10% last week. A year ago, it averaged 6.29%.
Even these minor shifts in rates seem to be making an impact. The housing market remains tight, with buyers eager to find opportunities amid ongoing challenges.
The current environment reflects the tension between affordability and demand. Any fluctuation in rates continues to draw immediate attention from prospective homebuyers.
For now, the trend offers a glimmer of hope for those waiting to enter the market. But affordability challenges aren’t going away anytime soon.