AP Business Writer Alex Veiga
McLean, Va. (AP) – The average 30-year U.S. mortgage rate has eased for three consecutive weeks. This is a welcome trend for future home buyers when higher borrowing costs continue to drag on in the housing market.
Mortgage buyer Freddie Mac said Wednesday that the long-term rate fell to 6.81% from 6.84% last week. A year ago, the price averaged 6.87%.
The borrowing costs for 15-year fixed-rate mortgages, which are popular for homeowners to refinance their mortgage, have also decreased. The average rate eased to 5.96% from 5.97% last week. According to Freddie Mac, a year ago it was 6.13%.
Mortgage rates are influenced by several factors, from the Federal Reserve’s interest rate policy decisions to bond market investors’ economic and inflation expectations. The important barometer is the 10-year Treasury yield. This is used by lenders as a guide to mortgage pricing.
The 2010 Treasury yield fell from 4.35% at noon on Wednesday, down from 4.58% just a few weeks ago.
The average 30-year mortgage rate remains relatively high so far, slightly above the 7% this year set in mid-January. The low rate for the 30 years this year fell to 6.62% in early April.
With the latest decline, the average rates return to where it was mid-May, reflecting the recent pullback in bond yields.
High mortgage fees can add hundreds of dollars a month to borrowers, reducing purchasing power. This helped keep the US housing market in a poor sales date back to 2022. This is when mortgage rates began to rise due to the low rock bottom reached during the pandemic.
Last year, sales of previously occupied US homes sank to their lowest levels in nearly 30 years. Sales have remained weaker this year, and recently the spring home buying season has diminished.
Rising borrowing costs are putting pressure on the market for new homes. The government reported on Wednesday.
This month, a meticulous measure of home builders’ sentiment sank this month into a third-lowest read since 2012, reflecting builders’ concerns over the impact that mortgage rates and economic uncertainties are cooling demand for new homes.
Original issue: June 18th, 2025, 12:11pm EDT
