The 30-year fixed-rate mortgage (FRM) averaged 6.42% this week, a slide downward for the second week from last week’s drop to 6.60%, according to the latest Primary Mortgage Market Survey® (PMMS®) from Freddie Mac released Thursday.
This week’s numbers:
- 30-year fixed-rate mortgage averaged 6.42% as of March 23, 2023, down from last week when it averaged 6.60%. A year ago at this time, the 30-year FRM averaged 4.42%.
- 15-year fixed-rate mortgage averaged 5.68%, down from last week when it averaged 5.90%. A year ago at this time, the 15-year FRM averaged 3.63%.
What the experts are saying:
“Mortgage rates continued to slide down as financial market concerns came to the fore over the last two weeks,” said Sam Khater, Freddie Mac’s chief economist. “However, on the homebuyer front, the news is more positive with improved purchase demand and stabilizing home prices. If mortgage rates continue to slide over the next few weeks, look for a continued rebound during the first weeks of the spring homebuying season.”
Realtor.com economic data analyst, Hannah Jones commented:
“The Freddie Mac fixed rate for a 30-yr mortgage slid 0.18 percentage points this week to 6.42% as stability returned to the banking sector and market outlook improved after the Fed meeting. Concerns over further bank failures waned and markets proceeded with business as usual. The 10-year treasury climbed on Tuesday ahead of the FOMC meeting as investors prepared for the impact of the committee’s revised rate projections, but fell on Wednesday after the Fed signaled that their series of aggressive rate hikes could be coming to an end.
“The FOMC once again emphasized their commitment to cooling inflation to 2% during Wednesday’s meeting, but softened their stance on additional rate increases. Chair Powell stated that the recent banking sector instability is likely to lead to tighter lending requirements, which could serve to cool inflation. Depending on the extent of the impact of a tighter banking sector, Powell expressed a ‘wait-and-see’ approach to further contractionary policy. However, the Federal Funds rate is expected to remain elevated through the end of the year, meaning that a higher interest rate environment is here to stay for the time being, including for home loans.
“Ongoing affordability challenges weigh on buyers and sellers preparing for the spring housing market. Each downward tick in mortgage rates is met with increased buyer demand, as many eager home shoppers take advantage of the slightly lower cost of financing a home. Home prices were up 7.8% compared to last February, but price growth continues to slow and price reductions continue to climb. Home shoppers are looking to find the optimal combination of prices and mortgage rates before entering the market. However, elevated rates and high prices mean that point doesn’t yet exist in the market for many would-be buyers. At the current price and mortgage rate level, the typical housing payment on a median-priced home is still 36.4% higher than one year ago.”