MCLEAN, Va. — The average rate on a 30-year U.S. mortgage fell this week to its lowest level in nearly 10 months, giving prospective homebuyers a sorely needed boost in purchasing power that could help inject life into a stagnant housing market.
The long-term rate fell to 6.58% from 6.63% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.49%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell. The average rate dropped to 5.71% from 5.75% last week. A year ago, it was 5.66%, Freddie Mac said.
Elevated mortgage rates have helped keep the U.S. housing market in a sales slump since early 2022, when rates started to climb from the rock-bottom lows they reached during the pandemic. Home sales sank last year to their lowest level in nearly 30 years.
This is the fourth week in a row that rates have come down. The latest average rate on a 30-year mortgage is now at its lowest level since Oct. 24, when it averaged 6.54%.
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 main barometer is the 10-year