As consumer prices fell for the first time in four years and home prices declined in some markets, the average 30-year fixed-rate mortgage followed suit, falling to 6.89% this week from 6.95% last week, according to Freddie Mac's latest Primary Mortgage Market Survey® (PMMS®) released Thursday.
Let's take a look at this week's numbers:
The average yield on a 30-year fixed rate loan is 6.89% as of July 11, 2024, down from last week's average yield of 6.95%. At the same time a year ago, the average yield on a 30-year fixed rate loan was 6.96%. The average yield on a 15-year fixed rate loan is down from last week's average yield of 6.25%. At the same time a year ago, the average yield on a 15-year fixed rate loan was 6.30%.
Expert opinion:
“Following the June jobs report showing a weakening labor market, the 10-year Treasury yield fell this week, and mortgage rates followed suit,” said Sam Carter, chief economist at Freddie Mac. “There is also more inventory on the market, including at reduced prices, which is an encouraging sign for potential buyers.”
Ralph McLaughlin, senior economist at Realtor.com, adds: “Friday's jobs report and (yesterday's) CPI report were both solid numbers, suggesting inflation is under control amid slowing job growth, rising unemployment and cooling price levels. This has given investors confidence that interest rates will be lower by the end of the year, and today the 10-year Treasury note fell to its lowest since March. Though volatile, 10-year Treasury rates continue to trend lower, which should result in gradual declines in mortgage rates for the rest of the year.”
“This downward trend is undoubtedly welcome news for homebuyers who have been deterred by high interest rates and low inventory. However, the news is certainly more positive. Inventory is currently on a strong upward trend, with active listings up more than 36% compared to this time last year. Increased inventory should help cap price growth, and lower mortgage rates should help ease monthly mortgage payments for new borrowers. That said, we don't expect any sudden changes, but rather a gradual shift through the remainder of this year and into next year.”