Mortgage Rates Edge Lower Amidst Economic Data Quiet
Mortgage rates have experienced a slight decline this week as economic data releases have been sparse. According to Freddie Mac, the average 30-year fixed-rate mortgage stood at 6.85% through Wednesday, down from 6.87% the previous week. The average 15-year mortgage rate also decreased, from 6.09% to 6.04%.
Despite hotter-than-expected inflation data last week, financial markets have remained largely unfazed. This week's absence of significant releases has not altered investors' expectations regarding inflation and the Federal Reserve's interest rate decisions. As a result, 10-year Treasury yields have fluctuated slightly but remain around 4.5%, closely mirroring mortgage rates.
Mortgage rates have been gradually trending lower in recent weeks but remain near 7%, impacting home affordability for many potential buyers. According to the Mortgage Bankers Association (MBA), mortgage applications to purchase a home fell 6% while refinancing applications declined 7% over the past week. This marks the lowest combined application volume all year.
"Many potential homebuyers are holding out for improved supply and affordability conditions before entering the market," stated Bob Broeksmit, MBA President and CEO.
However, Freddie Mac's chief economist, Sam Khater, noted that five consecutive weeks of rates below 7% could boost confidence among buyers and sellers as the busy spring home-buying season approaches. "This stability bodes well for potential buyers and sellers as we head into the spring homebuying season," he said.