A drop in US mortgage rates is offering early encouragement to prospective homebuyers ahead of the crucial spring homebuying season, even as borrowing costs continue to hover near the 6% mark.
The average rate on a 30-year fixed mortgage declined to 6.01% this week from 6.09% a week earlier, mortgage buyer Freddie Mac said Thursday, AP reported. The rate stood at 6.85% during the same period last year.
The latest reading marks the lowest level for the benchmark mortgage rate in more than three years, since September 8, 2022, when it averaged 5.89%. That was also the last time borrowing costs dipped below the 6% threshold.
“The recent decline in rates is a favorable lead in to the annual spring homebuying season — good news for home shoppers who can afford to buy at current rates.”
Shorter-term borrowing costs also eased. The average rate on a 15-year fixed mortgage, widely used by homeowners refinancing existing loans, fell to 5.35% from 5.44% last week. A year earlier, the average stood at 6.04%, according to Freddie Mac.
