Mortgage Rates Slip to 7.32 Percent in First Weekly Decline Since August

Mortgage rates in the United States fell for the first time since August. The decline was not large, but it stopped a climb that had lasted for months.

The average rate on a 30-year fixed mortgage was 7.32%, down 0.08 percentage points from 7.40% the week before, according to Freddie Mac’s weekly survey released Thursday. The average 15-year fixed rate also eased, to 6.68% from 6.71%.

The 30-year rate had not fallen in any week since August 20, and 7.40% was the highest level of the past 52 weeks. Rates remain more than a percentage point above the average of 6.19% recorded a year ago.

In dollar terms, the change looks like this. On a $400,000 loan with a 30-year fixed rate, a move from 7.40% to 7.32% lowers the monthly principal and interest payment by about $22. The calculation excludes taxes and insurance.

Sam Khater, Freddie Mac’s chief economist, said the decline should give homebuyers some breathing room.

Forecasters remain cautious. In its October outlook, Fannie Mae projected the 30-year rate would average 7.4% in the fourth quarter of this year and 7.5% throughout 2027. The Mortgage Bankers Association also expects only a gradual easing, from 7.3% in this year’s fourth quarter to 7.1% by the end of 2027.

Mortgage rates do not follow the federal funds rate set by the Federal Reserve directly. They tend to track the yield on the 10-year Treasury note, the benchmark for market rates. That yield has recently moved around 5%.

The Associated Press has noted that mortgage rates began rising after the war with Iran started in late February. The war pushed up oil prices and inflation, unsettled the bond market, and the effects spread into housing finance. One week of decline is too early to call a change in direction.