US 30-Year Fixed-Rate Mortgage Rate Drops to 6.20% – Impact on Housing Market
US 30-year fixed-rate mortgage rates fall to 6.20%, the lowest since February 2023. Despite this decline, high home prices and low inventory keep buyers cautious
U.S. mortgage rates have decreased, reflecting market expectations that the Federal Reserve will begin reducing interest rates soon. Despite this positive shift, the housing market continues to face significant challenges due to elevated home prices and ongoing supply constraints.
The average rate for a 30-year fixed-rate mortgage fell to 6.20%, the lowest it has been since February 2023. This drop from the previous week's 6.35% marks a notable shift from the 7.18% average seen at this time last year. The decrease is attributed to anticipated actions by the Federal Reserve, which is expected to initiate an interest rate cut of 25 basis points next week.
Similarly, the average rate for a 15-year fixed-rate mortgage has decreased to 5.27%, down from 5.47% the previous week. This is a significant reduction from the 6.51% average rate reported a year ago.
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While these lower mortgage rates may seem promising, they have not yet translated into a surge in housing market activity. Homebuyers are still facing high property prices and a limited supply of available homes, which continues to dampen enthusiasm. Many potential buyers remain cautious, waiting for more favorable market conditions before making a move.
Also Read: US Home Prices Hit Record High in June While Growth Slows
