30-Year Mortgage Slips to 6.5% — Relief, Not a Rescue

Mortgage rates keep inching down, handing homebuyers a little breathing room. The average 30-year fixed rate fell to 6.5% this week, down from 6.56% and the lowest since mid-October, according to Freddie Mac. It’s the latest step away from the 7% ceiling that scared off a lot of shoppers earlier this year.

The 15-year fixed also eased, landing at 5.6%.

Some, but not a stampede. Lower borrowing costs have already nudged the median monthly mortgage payment to its lowest level since January, Redfin says. Even so, the brokerage sees only a “modest uptick” in sales. Prices are still steep, and plenty of would-be buyers are waiting for a bigger break.

“Rates haven’t come down enough to bring back a flood of buyers,” said Mariah O’Keefe, a Redfin agent in Seattle. Many are “on rate watch, hoping they’ll drop below 6%.”

Wall Street is betting the Federal Reserve will cut rates by 0.25 percentage points later this month. Mortgage rates track the 10-year Treasury yield more than anything else, and that yield has drifted lower ahead of Friday’s jobs report. A softer labor read usually helps push mortgage rates down.

The Fed’s independence is under a spotlight, and the administration has floated big housing rhetoric — Treasury Secretary Scott Bessent even said the president may consider declaring a national housing emergency this fall.

What this means for buyers and owners:

• Buyers: Every dip adds a bit of purchasing power, but affordability is still tight in many markets. If rates keep sliding toward the low-6s (or below), expect competition to heat up quickly.
• Refi window: More current homeowners will pencil out a refinance if rates keep grinding lower, though the refi math still doesn’t work for most who locked in pandemic-era lows.

At 6.5%, the market is getting friendlier — not cheap. Watch Friday’s jobs report and the Fed meeting later this month. If both break the right way, the next leg lower could finally coax more buyers off the sidelines.

Bloomberg, FOX Business, and the Associated Press contributed to this report.