The average 30-year fixed-rate mortgage in the United States declined slightly to 6.81% during the week ending June 18, down three basis points from the previous week’s 6.84%, according to Freddie Mac’s Primary Mortgage Market Survey. This marks the first weekly decline in four weeks, though rates remain near their highest levels since late November 2023.
Market Context
The modest easing occurred against a backdrop of:
- Treasury Yield Stability: 10-year notes trading in a narrow 4.22%-4.29% range
- Fed Policy Uncertainty: Mixed economic data clouding rate cut expectations
- Housing Market Strain: Existing home sales down 7.1% year-over-year in May
Industry Implications
Current rate levels continue to impact housing dynamics:
- Affordability Challenge: Monthly payments ~60% higher than 2021 levels
- Inventory Crunch: Active listings remain 34% below pre-pandemic norms
- New Construction Strength: Builder confidence holding near 6-month highs
Analysts note the 6.8% range appears to be establishing as a new baseline, with any sustained move below 6.5% potentially unlocking pent-up demand. Market participants await next week’s PCE inflation data for clearer signals on whether mortgage rates might break out of their recent 6.6%-7.1% range in the second half of 2024.
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