Mortgage rates fall to their lowest level in almost three months

Mortgage rates fell this week to their lowest level since early April, taking some pressure off America’s unaffordable housing market.

Mortgage rates fell this week to their lowest level since early April, taking some pressure off America’s unaffordable housing market. The standard 30-year fixed-rate mortgage averaged 6.87% in the week ending June 20, mortgage financing giant Freddie Mac reported Thursday. That’s down from last week’s 6.95% average and marks the third consecutive weekly decline. Rates are down from a 2024 peak of 7.22%. “Mortgage rates fell for the third straight week following signs of cooling inflation and market expectations of a future Federal Reserve rate cut,” said Sam Khater, Freddie Mac’s chief economist, in a release. “These lower mortgage rates coupled with the gradually improving housing supply bodes well for the housing market.” Still, mortgage rates remain higher than anything seen in the decade before 2022, the year the Federal Reserve began to raise interest rates to combat inflation. Borrowing costs are poised to ease this year, but it may not be by much. Earlier this month, Fed officials penciled in just one interest rate cut for this year, compared to the three they forecast in March. The Fed doesn’t directly set mortgage rates but its actions do influence them through the benchmark 10-year US Treasury yield, which moves in anticipation of the Fed’s policy moves. Economists don’t expect the average mortgage rate to fall below 6% this year. While mortgage rates have eased recently, the US housing market overall remains hamstrung by elevated interest rates, which seem to be taking a toll on homebuilding.