30-Year Mortgage Rate Falls to 7.24% After Monthly Peak

The average 30-year fixed-rate mortgage in the United States dropped to 7.24% this week, marking the lowest level in more than a month. Freddie Mac reported the decline on Thursday, noting that the rate had been 7.32% in the previous week. This represents a second consecutive week of decreases for long-term borrowing costs.

The 15-year fixed-rate mortgage also saw a reduction, slipping to 6.60% from 6.68% last week. A year ago, the 30-year rate stood at 6.17%, while the 15-year rate was 5.41%. The current figures reflect a continued easing in the bond market following a period of significant volatility.

Mortgage rates have been on an upward trend since late February, coinciding with the start of the U.S. war with Iran. The conflict drove up oil prices and inflation, which in turn increased bond yields. Lenders typically price home loans based on the 10-year Treasury yield, which serves as a primary guide for mortgage rates.

Earlier this month, the 30-year mortgage rate hit 7.4%, its highest point in nearly three years. The 10-year Treasury yield surged past 5.30% during that same period, a level far above the 3.97% recorded before the war began. By midday Thursday, the 10-year yield had settled at 4.98%, contributing to the recent dip in mortgage costs.

Rising rates have stalled U.S. home sales throughout the year. Higher borrowing costs limit purchasing power, often adding hundreds of dollars to monthly payments for buyers. Since late February, when the 30-year rate briefly fell to 5.98%, the increase in rates has added approximately $350 to the monthly cost of a $400,000 loan.

The housing market has remained in a slump since 2022, when rates began climbing from pandemic-era lows. Sales of previously occupied homes were flat last year, staying at a 30-year low. Individual borrowers may qualify for rates above or below the national average depending on their income, credit history, and other financial factors.

Freddie Mac tracks these weekly averages to provide a benchmark for the housing market. The current decline offers some relief to prospective buyers, although the rates remain elevated compared to levels seen in 2024. The 15-year rate is often sought by homeowners looking to refinance existing loans to lower their monthly payments.