The 30-year fixed-rate mortgage (FRM) averaged 6.69% this week, down from last week’s average of 6.81% and falling to its lowest level in over a month, according to the latest Primary Mortgage Market Survey® (PMMS®) from Freddie Mac, released Thursday.
“Despite just a modest drop in rates, consumers clearly have responded as purchase demand has noticeably improved,” said Sam Khater, Freddie Mac’s chief economist. “The responsiveness of prospective homebuyers to even small changes in rates illustrates that affordability headwinds persist.”
This week’s numbers:
- The 30-year FRM averaged 6.69% as of December 5, 2024, down from last week when it averaged 6.81%. A year ago at this time, the 30-year FRM averaged 7.03%.
- The 15-year FRM averaged 5.96%, down from last week when it averaged 6.10%. A year ago at this time, the 15-year FRM averaged 6.29%.
“Though mortgage rates are moving in the right direction for prospective homebuyers, they still find themselves in a tough spot as rates are only slightly lower than they were a year ago and more than double what they were three years ago,” said Realtor.com Senior Economist Joel Berner. “We expect rates to continue to inch down in coming months and spend much of 2025 in the low-6% range.”
Berner also noted that affordability remains a primary concern in the housing market, calling this week’s continuation of a decline “welcome news” to many homebuyers who have been on the sidelines trying to piece together a budget to purchase a home.
“Inventory growth over the past several months has been another encouraging factor, as the number of homes for sale is finally approaching pre-pandemic levels,” Berner added. “With listing prices and mortgage rates remaining stubbornly high, though, buyers are seeing plenty of options but few that they can afford. Continued relief from mortgage rates combined with increasing numbers of price cuts may lead to a stronger 2025 in terms of home sales volume.”
To read this week’s full report, click here.
