Mortgage Rates Increase After a Month of Declines
The 30-year fixed-rate mortgage rose five basis points from last week, reaching 6.22%, while the 15-year fixed-rate mortgage increased by nine basis points to 5.50%. This marks a reversal following a month of consecutive declines in mortgage rates, which followed the movement of the 10-year Treasury.
Current Mortgage Rate Trends
- The 30-year fixed-rate mortgage averaged 6.22%, up from last week’s 6.17%, which had been a slight two basis point decrease.
- One year ago, the 30-year rate was higher at 6.79%.
- The 15-year fixed-rate mortgage climbed to 5.50% from 5.41% the previous week.
- Last year, the 15-year rate stood at 6%.
"On a median-priced home, this could allow a homebuyer to save thousands annually compared to earlier this year, showing that affordability is slowly improving," said Sam Khater, Freddie Mac's chief economist.
Federal Reserve Impact and Market Reactions
The Federal Reserve’s recent 25 basis point rate cut has had limited effect on mortgage rates so far, which have instead increased by three basis points. The muted impact may be linked to Federal Reserve Chair Jerome Powell's remarks during the Federal Open Market Committee meeting, where he expressed skepticism about further rate cuts in December.
Since Powell’s comments, the 10-year Treasury yield has risen from 3.98% to 4.08% as of noon Thursday.
The slight rise aligns with Zillow’s recent observation that the 30-year mortgage rate is likely to remain between 6% and 7% for now.
Summary
Mortgage rates reversed a downward trend this week, signaling persistent affordability challenges despite Federal Reserve efforts to lower borrowing costs.
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