Mortgage rates fell for the third consecutive week on Thursday in a promising sign for the housing market that stalled out after mortgage rates climbed to nearly 8% last month.
The 30-year fixed-rate mortgage rate fell to 7.44% from last week's 7.5%. Prior to the week ending November 9, the 30-year mortgage term was 7.76%, according to data from Freddie Mac's Primary Mortgage Market Survey. That being said, the mortgage rate remains higher than the 6.61% average recorded during the same period in 2022.
The average for the 15-year fixed-rate mortgage has also seen a three-week downtrend, falling to 6.76% from last's 6.81%. In comparison, the mortgage rate on a 15-year term was at 6.38% a year ago.
"For the third straight week, mortgage rates trended down, as new data indicates that inflationary pressures are receding," Sam Khater, Freddie Mac's chief economist, said. "The combination of continued economic strength, lower inflation and lower mortgage rates should likely bring more potential homebuyers into the market."
Will Mortgage Rates Continue Falling?
While another mortgage rate hike is possible, National Association of Realtors chief economist Lawrence Yun said he believes the numbers will continue to decline and fall into the 6% range "by the spring of 2024."
"Mortgage rates are plunging with the news of inflation calming," Yun said, as quoted in a report by Fox Business. "The interest rate rises should be over, and the Fed will have to consider cutting interest rates seriously. In the meantime, the bond market is reacting as if the Fed will be cutting interest rates next year. Mortgage rates look to head towards 7% in a few months and into the 6% range by the spring of 2024."
The consecutive dip in mortgage rates has led to a rising number of mortgage applications. A report from the Mortgage Bankers Association published Wednesday said mortgage applications rose 2.8% last week, which is 0.4% higher than the week prior. It marked the second straight week of gains and the highest level in five weeks.
Freddie Mac's average mortgage rate is based on applications it received from lenders across the United States.
