The average rate on a 30-year U.S. mortgage fell modestly for the second straight week, but home borrowing costs remain elevated, the Associated Press reports.
The long-term rate inched back to 6.84% from 6.85% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.95%.
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.
The 10-year Treasury yield was at 4.38% at midday Thursday, down from 4.58% just a few weeks ago.
Bond yields have retreated in recent weeks but broadly have been trending higher since hitting 2025 lows in early April, reflecting investors’ uncertainty over the Trump administration’s ever-changing tariffs policy and worry over federal government debt.
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 30-year rate’s low point this year was in early April when it briefly dipped to 6.62%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, declined to 5.97% from 5.99% last week. The average a year ago was 6.17%, Freddie Mac said.
