As homebuyers and borrowers looking to refinance are experiencing a welcomed period of relief from elevated rates, the average 30-year fixed rate mortgage fell significantly again this week to its largest weekly drop in a year, mortgage watchers noted.
According to the latest Primary Mortgage Market Survey® (PMMS®) released by Freddie Mac Thursday, the 30-year fixed-rate mortgage (FRM) averaged 6.35% a decrease from last week’s average of 6.50%.
“The 30-year fixed-rate mortgage fell 15 basis points from last week, the largest weekly drop in the past year,” said Sam Khater, Freddie Mac’s chief economist. “Mortgage rates are headed in the right direction and homebuyers have noticed, as purchase applications reached the highest year-over-year growth rate in more than four years.”
Realtor.com Economist Jiayi Xu said while the CPI data showed inflation remained sticky in August, investors were already nearly certain of a Fed rate cut in September, especially after a slowdown in U.S. job growth and an initial weekly jobless claims rising to their highest level since October 2021.
“The September decision may once again see dissent—not on whether to cut, but on how large the reduction should be, as some voting members may favor a bigger move to get ahead of the cooling labor market,” Xu said. “While markets are betting on three straight quarter-point cuts at each of the Fed’s remaining policy meetings this year, sticky August inflation adds uncertainty to the path ahead.”
Experts noted that as the anticipated Fed rate cut approaches, mortgage rates have edged lower, providing some relief to active buyers and helping stabilize borrowing costs. However, Xu said its impact on overall market momentum is likely to be gradual, since 81% of homeowners hold mortgages below 6%, keeping rates too high to prompt most existing owners to sell and leaving inventory constrained.
“Looking ahead, rates may stabilize or even rise slightly after the FOMC meeting, as markets—positioned for more aggressive easing—could be disappointed by the Fed’s guidance, further limiting potential housing activity,” she said.
This week’s numbers:
- The 30-year FRM averaged 6.35% as of September 11, 2025, down from last week when it averaged 6.50%. A year ago at this time, the 30-year FRM averaged 6.20%.
- The 15-year FRM averaged 5.50%, down from last week when it averaged 5.60%. A year ago at this time, the 15-year FRM averaged 5.27%.
