30-Year Mortgage Rates Dip Slightly Amid Market Volatility
Average 30-year mortgage rates edged downward to 6.87% this week, according to Freddie Mac data, from 6.89% the previous week. The 15-year rate rose slightly to 6.09%.
Despite the decline, rates remain close to 6.9%, hovering within a narrow range after hitting 7.04% in mid-January. Market volatility and shifting economic data have kept rates relatively stagnant.
Factors Affecting Mortgage Rates
* Inflation: January's Consumer Price Index data indicates rising inflation, tempering hopes for interest rate cuts.
* Federal Reserve Interest Rates: Mortgage rates track 10-year Treasury yields, which initially spiked before dropping sharply following President Trump's tariff announcements.
* Investor Expectations: Investors demand higher returns amid weakening consumer spending power, reducing the likelihood of significant interest rate reductions.
Impact on Mortgage Applications
Near-7% rates have suppressed mortgage applications for home purchases, according to the Mortgage Bankers Association. Purchase applications fell 2% last week.
Expert Outlook
"Mortgage rates are unlikely to drop significantly in the near term," says Joel Berner, senior economist at Realtor.com. "The days of sub-4% rates are over, and if inflation persists, they may not return anytime soon."