Average US 30-Year Mortgage Rate Drops to 6.89%, Third Straight Weekly Decline

The average US 30-year fixed-rate mortgage rate has fallen to 6.89% this week, marking the third consecutive weekly decline, according to Freddie Mac's Primary Mortgage Market Survey (PMMS). This decrease brings the rate closer to the long-term average of 7.72% and offers some relief to homebuyers and refinancers alike.

The recent decline in mortgage rates can be attributed to several factors, including the Federal Reserve's policy decisions, economic conditions, and market demand. The Federal Reserve has been cutting interest rates, which has a direct impact on mortgage rates. In December 2022, the Fed cut rates by 25 basis points, and in January 2025, they announced another rate cut, which is expected to further lower mortgage rates. Additionally, easing economic conditions, such as lower inflation, have contributed to the decline in mortgage rates.



The current mortgage rate trends have a significant impact on affordability for both first-time homebuyers and existing homeowners looking to refinance. Higher mortgage rates make it more expensive for first-time homebuyers to purchase a home, while existing homeowners with adjustable-rate mortgages or those who refinanced at lower rates in the past may find it difficult to justify refinancing with current rates hovering around 6.89%. However, the recent decline in mortgage rates offers some relief and could encourage more buyers to enter the housing market.

The expected trajectory of mortgage rates in the coming months is uncertain, as it depends on various economic factors and the Federal Reserve's policy decisions. If mortgage rates continue to decline, this could encourage more buyers to enter the housing market, increasing demand and potentially leading to bidding wars and higher home prices. However, if mortgage rates stabilize or slightly increase, this could lead to a more balanced housing market with a modest increase in home prices. It is essential to monitor economic indicators and the Federal Reserve's policy decisions to better understand the potential impacts on the housing market.

In conclusion, the recent decline in the average US 30-year fixed-rate mortgage rate to 6.89% offers some relief to homebuyers and refinancers. However, the trajectory of mortgage rates in the coming months remains uncertain, and it is crucial to monitor economic indicators and the Federal Reserve's policy decisions to better understand the potential impacts on the housing market.