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A ‘For Sale’ sign is posted outside a single family home on August 22, 2025 in Pasadena, California. (Photo by Mario Tama/Getty Images)
Mortgage rates moved slightly higher this week but remained largely stable, according to Freddie Mac's latest Primary Mortgage Market Survey released Thursday.
By the numbers:
The average rate on the benchmark 30-year fixed mortgage increased to 6.49%, up from 6.47% last week. Two weeks ago, the average stood at 6.52%. At the same time last year, the 30-year fixed-rate mortgage averaged 6.77%.
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What they’re saying:
"The average 30-year fixed mortgage rate was little changed this week at 6.49%," said Sam Khater, chief economist at Freddie Mac.
"Rates have remained relatively stable over the last six weeks. Meanwhile, purchase activity eased modestly and eased modestly and refinance activity has continued to pick up recently, reflecting borrowers' responsiveness to current rate levels," Khater added.
Big picture view:
Borrowing costs on shorter-term loans also increased modestly. The average rate on a 15-year fixed mortgage rose to 5.84% this week from 5.81% last week, though it remained below the 5.89% average recorded a year earlier.
Mortgage rates are influenced by a range of economic factors, including Federal Reserve policy expectations and geopolitical developments. While mortgage rates are not directly tied to the Fed's benchmark interest rate, they closely follow movements in the 10-year Treasury yield, which hovered around 4.4% on Thursday afternoon.
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Dig deeper:
The latest mortgage survey follows last week's Federal Reserve decision to leave its benchmark interest rate unchanged at a range of 3.5% to 3.75%. Policymakers opted to hold rates steady as inflation remained stubbornly elevated, driven in part by higher oil prices stemming from the Iran war's impact on global supplies.
The decision marked the first policy meeting under newly appointed Federal Reserve Chair Kevin Warsh. Officials voted unanimously to keep rates unchanged, while the Fed's updated "dot plot" showed that nine of the 17 members of the Federal Open Market Committee expect at least one interest rate hike before the end of the year.
Fresh inflation data released Thursday reinforced the Fed's cautious stance. The Commerce Department reported that the personal consumption expenditures (PCE) price index—the central bank's preferred inflation measure—rose 4.1% over the past year, while the core PCE index, which excludes food and energy prices, increased 3.4%.
Both inflation measures remain well above the Fed's long-run 2% target, reducing investors' expectations for interest rate cuts this year.
What’s next:
According to the CME FedWatch Tool, markets currently view the Fed holding rates steady through year-end as the most likely outcome. The tool also indicates investors now see a greater chance of one or more rate hikes before the end of the year than a rate cut.
The Source: FOX Business contributed to this report. The information in this story comes primarily from Freddie Mac’s Primary Mortgage Market Survey, which provided the latest mortgage rate data and comments from Chief Economist Sam Khater. This story was reported from Los Angeles.
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