Mortgage Rates Dip to 6.87% Amid Economic Uncertainty

Mortgage rates in the U.S. have experienced a slight decrease, with the average 30-year fixed rate dropping to 6.87% as of June 5, 2025. This decline follows a period where rates had stabilized around 7% for 30-year, fixed-rate loans across the nation. The recent dip in yields on 10-year bonds, which fell below 4.4% for the first time since early May, is likely to influence mortgage rates to move lower. Freddie Mac's weekly rate survey also indicated this trend, with the average rate on a 30-year fixed-rate loan decreasing to 6.85% for the week ending June 5, a slight reduction of 0.04 percentage points. Similarly, the rate on a 15-year fixed-rate loan decreased by 0.04 percentage points to an average of 5.99%.

The U.S. economy is currently facing several challenges that could impact the movement of mortgage rates. The labor market appears to be weakening, and new tariffs on steel and aluminum imports have been implemented, which could potentially increase consumer prices. These factors, along with a weaker-than-expected employment report, have contributed to the recent decline in mortgage rates. However, the combination of high mortgage rates and rising home prices continues to pose affordability challenges for prospective homebuyers, keeping many on the sidelines this spring.

The slight dip in mortgage rates provides some relief for homebuyers who have been dealing with elevated rates. However, the trend may soon change as the economy encounters several obstacles. The labor market appears to be weakening, and new tariffs on steel and aluminum imports have been implemented, which could potentially increase consumer prices. Depending on how these factors play out, mortgage rates will either remain elevated or start trending lower. With so much uncertainty in the air, prospective homebuyers continue to face affordability challenges. Rates are hovering around 7%, and home prices in most markets continue to rise, although at a slower pace than in recent years. The combination is keeping many buyers on the sidelines this spring.