The average rate on a 30-year mortgage in the U.S. eased again this week, modest relief for prospective home shoppers during what’s traditionally the busiest time of the year for the housing market.
The rate fell to 6.76% from 6.81% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 7.22%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell. The average rate dropped to 5.92% from 5.94% last week. It’s down from 6.47% a year ago, Freddie Mac said.
Mortgage rates are influenced by several factors, including global demand for U.S. Treasurys, the Federal Reserve’s interest rate policy decisions and bond market investors’ expectations for future inflation.
When mortgage rates decline they help boost homebuyers’ purchasing power.
After climbing to a just above 7% in mid-January, the average rate on a 30-year mortgage has remained above 6.62%, where it was just three weeks ago. It then spiked above 6.8% the next two weeks, reflecting volatility in the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
The yield, which had mostly fallen after climbing to around 4.8% in mid-January, surged last month to 4.5% amid a sell-off in government bonds triggered by investor anxiety over the Trump administration’s trade war.
The 10-year Treasury yield was at 4.23% in midday trading Thursday, up from 4.17% late Wednesday.
