Mortgage rates reached another 11-month low this past week, as markets are pricing in an expected short-term rate cut from the Federal Open Market Committee later this month.
This follows a week where one long-term Treasury rate showed serious volatility. The 30-year Treasury bond
But the 10-year Treasury, which is used in mortgage pricing because it is more widely available, ended Wednesday about 7 basis points lower than the prior day, falling to 4.21% from 4.28%; during Tuesday's trading, it reached 4.31%, its highest level since Aug. 22.
At 11 a.m. eastern time on Thursday morning, the yield dropped to 4.2%, which was 4 basis points lower than its Aug. 27 close.
What are this week's mortgage rates?
As a result, the 30-year fixed rate mortgage fell to 6.5% for Sept. 4,
The 30-year is at its lowest point since the
Why did mortgage rates change this week?
"Markets have been adjusting to a wave of mixed signals over the past few weeks," Sami Dedhia, CEO of One Real Mortgage, said in a commentary in advance of the Freddie Mac survey release.
Some thought the hotter-than-expected Producer Price Index inflation data would result in the FOMC delaying rate cuts, but Federal Reserve Chairman Jerome Powell's speech in Jackson Hole reopened the possibility of a cut later this month, Dedhia said.
"Since then, rates have steadied and the bond market is finally showing some consistency," Dedhia said. "That's good news for mortgage rates, which tend to follow long-term bond yields."
The falling rates are not just bringing buyers into the market, they are helping existing homeowners as well, said Sam Khater, Freddie Mac chief economist, in a press release.
"In fact, the share of market mortgage applications that were for a refinance reached nearly 47%, the highest since October," Khater said.
The 15-year fixed fell even lower to 5.6%, a 9 basis point drop from the previous week. For the week of Sept. 5, 2024, it was at 5.47%. This product had not been below its current level since
What data do other mortgage rate trackers show?
The
As measured by the MBA, rates on the conforming 30-year FRM were down 5 basis points from the prior week to 6.44%.
This brought rates down to a five-month low according to MBA's measurements, said Bob Broeksmit, president and CEO, in a Thursday morning commentary.
"Purchase activity has been mostly higher in recent weeks, but dropped modestly last week as affordability challenges continue to pose a hurdle for some prospective buyers," Broeksmit said.
Zillow's mortgage rate tracker put the 30-year fixed at 6.58% as of the same time, up 2 basis points from Wednesday but down 1 basis point from the previous week's average rate.
Lender Price product and pricing engine data on the National Mortgage News website Thursday morning found the 30-year FRM at 6.45%, 3 basis points lower than the previous week's 6.48%.
The weekly drop in mortgage rates was due to weaker-than-expected Job Openings and Labor Turnover data, said Kara Ng, a senior economist at Zillow Home Loans, in a Wednesday evening statement.
"Additional downward pressure came from Federal Reserve Governor Christopher Waller's comments advocating for multiple rate cuts," Ng said. "This move aligns rates closer to Zillow's prediction of a mid-6% range by year-end."
What's the next influence on mortgage rate movements?
Friday's Bureau of Labor Statistics data is the next key data point, Ng said, noting "continued signs of labor market weakness could likely reinforce the current downward trend in rates. Conversely, unexpectedly strong employment figures could quickly reverse recent gains."
This will be the first BLS report since Pres. Trump
