The average rate on a 30-year mortgage in the U.S. rose this week to its highest level since early February, further pushing up borrowing costs for homebuyers
Average rate on a US 30-year mortgage rises to 6.89%, its highest level since early FebruaryBy ALEX VEIGAAP Business WriterThe Associated Press
The average rate on a 30-year mortgage in the U.S. rose this week to its highest level since early February, further pushing up borrowing costs for homebuyers.
The rate increased to 6.89% from 6.86% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 7.03%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also rose. The average rate ticked up to 6.03% from 6.01% last week. It’s still down from 6.36% a year ago, Freddie Mac said.
Mortgage rates are influenced by several factors, from the Federal Reserve’s interest rate policy decisions to bond market investors’ expectations for the economy and inflation. The key barometer is the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
Bond yields have been trending higher, reflecting bond market investors’ uncertainty over the Trump administration’s ever-changing tariffs policy and worry over exploding federal government debt.
The 10-year Treasury yield was 4.43% in midday trading Thursday, down from 4.47% late Wednesday.
The average rate on a 30-year mortgage has remained relatively close to its high so far this year of just above 7%, set in mid-January. The average rate’s low point so far was six weeks ago, when it briefly dropped to 6.62%. It’s now at its highest level since Feb. 6, when it averaged 6.89%.
High mortgage rates, which can add hundreds of dollars a month in costs for borrowers, have reduced purchasing power for many prospective homebuyers this year. That’s helped keep the U.S. housing market in a sales slump dating back to 2022, when mortgage rates began to climb from the rock-bottom lows they reached during the pandemic.
Last year, sales of previously occupied U.S. homes sank to their lowest level in nearly 30 years. Sales fell last month to the slowest pace for the month of April going back to 2009.
