[ad_1]
2025-09-11T16:00:06Z
Mortgage rates are flashing a positive signal for prospective homebuyers.
Rates on the 30-year and 15-year fixed mortgages fell to their lowest level in about a year.
Financing activity also picked up significantly in the last week.
The frozen housing market just flashed one of its most promising signs yet that its deep freeze may be ending: mortgage rates are finally coming down, and not just by a small amount.
The rate on the 30-year fixed mortgage dropped to its lowest level in about a year in the last week, according to data from the Mortgage Bankers Association.
The MBA estimates that the 30-year fixed rate fell 15 basis points to around 6.49% in the week ending September 5. Freddie Mac data also shows that the 30-year fixed rate settled at 6.5% in the last week, the lowest level in about 11 months.
Borrowing costs for the 15-year fixed mortgage and the 5/1 adjustable rate mortgage have also improved. Both rates dropped to around 5.7% in the last week, the lowest in nearly a year.
Borrowing activity, meanwhile, has been picking up. Mortgage applications jumped 9.2% in the week ending September 5 compared to the prior week, while refinancing activity rose 12% over the last week and climbed 34% compared to the same week last year, MBA data shows.
The spur in activity and drop in rates has largely been fueled by recent weakness in the job market, according to Joel Kan, the vice president and deputy chief economist of the MBA.
Expectations that the Fed will cut rates to boost the economy and prop up the labor market have helped push down the 10-year US Treasury yield, which is the benchmark for long-term mortgage rates.
“The downward rate movement spurred the strongest week of borrower demand since 2022, with both purchase and refinance applications moving higher,” Kan wrote on Tuesday.
Related stories
Business Insider tells the innovative stories you want to know
Business Insider tells the innovative stories you want to know
Lower borrowing costs offer a glimmer of hope for prospective homebuyers, who have been sidelined for the past several years amid a lack of inventory and poor housing affordability.
Both parts of the puzzle are flashing signs that they’re starting to improve. Sellers are now outpacing buyers in the market at the fastest pace in over a decade, according to a May analysis from Redfin. The median sale price for a house, meanwhile, ticked lower to $410,800 in the second quarter, according to the US Census Bureau.
[ad_2]
Source link
