U.S. mortgage rates have fallen for four consecutive weeks, reaching the lowest level since October of last year
On Thursday, Freddie Mac stated in a statement that the average interest rate for a 30-year fixed-rate mortgage is 6.58%, down from 6.63% last week. However, Kara Ng, a senior economist at Zillow's mortgage business, believes that even if the Federal Reserve cuts interest rates, it cannot guarantee that borrowing costs for homebuyers will significantly decrease
The U.S. mortgage rates have declined for the fourth consecutive week, reaching the lowest level since October of last year. On Thursday, Freddie Mac stated in a release that the average rate for a 30-year fixed mortgage is 6.58%, down from 6.63% last week.
Although consumer inflation in the U.S. warmed up in July, the increase in commodity prices was moderate, alleviating some investors' concerns about the widespread impact of tariffs. Coupled with signs of a weakening job market, this data has fueled market bets that the Federal Reserve may restart interest rate cuts as early as the September meeting.
However, Kara Ng, a senior economist at Zillow's mortgage business, believes that even if the Federal Reserve cuts rates, it does not guarantee that borrowing costs for homebuyers will significantly decrease. Mortgage rates typically follow the movements of the 10-year U.S. Treasury yield, which is driven by traders' reactions to various economic reports. If tariffs further permeate prices, the Federal Reserve's policy space may be constrained.
Ng stated that the recent decline in mortgage rates may attract some buyers, but many are still on the sidelines as affordability remains a serious obstacle. "This year, the number of sellers returning to the market exceeds that of buyers, and they are facing the reality of unsold listings and a shrinking pool of qualified buyers."
