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Mortgage rates have seen a significant drop this week, reaching their lowest point since September 2022, as reported by NewsNation.
According to Freddie Mac, the average rate for a 30-year fixed mortgage has decreased to 6.01%, down from last week’s 6.09%. Just a year ago, this rate stood at 6.85%.
“The current lower rates are enhancing affordability for potential homebuyers and bolstering the financial standing of current homeowners,” remarked Sam Khater, Freddie Mac’s chief economist.
Khater further highlighted that the activity in refinancing applications has more than doubled over the past year, enabling recent homebuyers to cut their annual mortgage payments by several thousand dollars.
The interest rates for 15-year mortgages, often favored by those refinancing, have dropped to 5.35%, marking the lowest level since October 2024.
The latest rate relief follows a recent pullback in the 10-year Treasury yield, which mortgage rates closely track.
After spending the first part of 2025 hovering around 7%, long-term mortgage rates began trending lower in July as markets priced in the Federal Reserve’s upcoming rate cuts.
That decline has helped homebuyers regain some purchasing power, but it hasn’t been enough to bring them off the sidelines in a meaningful way.
Sales of previously occupied homes plunged 8.4% in January from the month prior — the biggest monthly decline in nearly four years, according to data from the National Association of Realtors.
Harsh winter weather likely contributed to the slowdown, but prices also played a role, rising to a January record of $396,800 amid tight supply. The increase in the median-home price marked the 31st consecutive month of year-over-year price gains, according to NAR.
Major housing forecasters expect the average 30-year fixed rate to hover in the low-6% range in 2026, suggesting further relief may be limited.
But even if rates do drop further, lagging supply means any extra rate help could erase the affordability boost many are hoping for, warned Jake Krimmel, senior economist at Realtor.com.
“Without a significant return of supply through the easing of the mortgage ‘lock-in effect,’ lower rates may simply reignite competition and spike prices,” Krimmel said.