The average U.S. long-term mortgage rate declined for the first time in six weeks, offering modest relief to prospective homebuyers even as borrowing costs remain higher than a year ago.
The benchmark 30-year fixed-rate mortgage fell to 6.67% on Thursday, down from 6.69% the previous week, mortgage buyer Freddie Mac reported. A year earlier, the average rate stood at 6.58%.
Rates on 15-year fixed-rate mortgages, often favored by borrowers looking to refinance, also eased. That rate averaged 5.96%, down from 6.01% the prior week but still above the 5.71% recorded at the same point in 2025.
Even small movements in mortgage rates carry weight for buyers. Elevated borrowing costs can add hundreds of dollars a month to loan payments, eroding purchasing power and prompting some shoppers to delay a purchase. That hesitation has been visible in recent data, with U.S. sales of previously occupied homes slowing again in July as rates climbed over prior weeks.
Mortgage rates are shaped by several forces, including inflation, policy decisions from the Federal Reserve, and bond market expectations for the broader economy. They generally track the 10-year Treasury yield, which lenders use as a reference point when pricing home loans.
That yield has also eased recently, falling to 4.61% by midday trading Thursday, down from 4.72% at the start of the week. The pullback in Treasuries helped nudge mortgage rates lower.
Both mortgage rates and bond yields have trended upward for much of the year, pressured by conflict between the United States and Iran that pushed crude oil prices sharply higher and stoked expectations for renewed inflation. Oil prices have retreated somewhat in recent weeks, though long-term borrowing costs have been slow to follow.
The latest dip echoes earlier episodes in which softening economic signals translated into relief for borrowers, a pattern seen when rates slid ahead of an anticipated Federal Reserve cut. Whether this week’s decline marks the start of a sustained trend or a brief pause remains uncertain.
For now, the modest drop offers a narrow window for buyers who have been waiting on the sidelines. Analysts will be watching upcoming inflation readings and Federal Reserve signals closely to gauge whether borrowing costs continue to ease into the autumn.