WASHINGTON — The average rate on a 30-year mortgage in the U.S. fell this week for the first time in a month, but borrowing costs for homebuyers remain elevated.
The long-term rate dipped to 6.85% from 6.89% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.99%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also came down. The average rate fell to 5.99% from 6.03% last week and 6.29% a year ago, Freddie Mac said.
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.
Bond yields have retreated the past week 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 exploding federal government debt.
The 10-year Treasury yield was 4.38% in midday trading Thursday, down from 4.54% a week ago.
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%.
High mortgage rates, which can add hundreds of dollars a month in costs for borrowers, have reduced purchasing power for many prospective homebuyers this year. That's helped keep the U.S. housing market in a sales slump that dates back to 2022, when mortgage rates began to climb from the rock-bottom lows they reached during the pandemic.
