U.S. mortgage rates fall for eighth week in a row, drawing buyers off the sidelines

It’s down 28 basis points from the previous week — one basis point is equal to one hundredth of a percentage point. 

A year ago, the 30-year was averaging at 6.27%.

The average rate on the 15-year mortgage was 5.95%, down from 6.38% last week. The 15-year was at 5.69% a year ago.

Freddie Mac’s weekly report on mortgage rates is based on thousands of applications received from lenders across the country that are submitted to Freddie Mac when a borrower applies for a mortgage. 

Separate data by Mortgage News Daily said that the 30-year fixed-rate mortgage was averaging at 6.64% as of Thursday afternoon.

What Freddie Mac said: “Lower rates are bringing potential homebuyers who were previously waiting on the sidelines back into the market and builders already are starting to feel the positive effects,” Sam Khater, chief economist at Freddie Mac, said in a statement. 

“A rise in homebuilder confidence, followed by new home construction reaching its highest level since May, signals a response to meet heightened demand as current inventory remains low,” he added.

What are they saying? “While declining rates is a positive for homebuyers, the lack of inventory—both because of a deficit of new construction and because existing homeowners are remaining in the homes longer—will continue to be a challenge in 2024,” Lisa Sturtevant, chief economist at Bright MLS, said in a statement.