Key takeaways
- Mortgage rates fell for a third straight week to the lowest average since mid-March, according to Freddie Mac.
- Rates have stayed in a narrow range since the U.S.–Iran ceasefire.
- The calmer rate environment is supporting housing activity, with mortgage applications rising for two weeks and data from Homes.com and the National Association of Realtors pointing to increased sales and contract signings heading into the spring market.
Mortgage rates fell for the third straight week to the lowest average since mid-March.
As of Thursday, the 30-year, fixed-rate mortgage averaged 6.23%, according to mortgage giant Freddie Mac. That's down from last week from the same time a year ago.
The 15-year, fixed-rate mortgage also fell, averaging 5.58% as of Thursday, lower than a week earlier and the previous year.
On a daily basis, the 30-year, fixed-rate mortgage was unchanged at 6.32% on Thursday, and the 15-year, fixed had risen modestly to 5.92%, according to Mortgage News Daily.
The steady mortgage market is giving buyers wiggle room
Mortgage rates have mostly stayed within a narrow range since the United States and Iran announced their ceasefire agreement a little over two weeks ago.
That trend will likely continue until there's more clarity — either another escalation or further de-escalation, according to Matthew Graham, chief operating officer at Mortgage News Daily.
"[Mortgage] rates remain focused on oil prices and war-related developments," he said in a blog post on Wednesday. "For now, the market is generally betting on de-escalation as seen in stocks being near all-time highs."
The resulting calmness in the mortgage market has given borrowers more confidence. Applications for mortgages have been on the rise for two weeks, according to data the Mortgage Bankers Association released on Wednesday. That overall increase has been driven by renewed activity among both homeowners refinancing their loans and buyers taking out a mortgage.
More than that, data from Homes.com showed that home sales increased in March, and the National Association of Realtors reported an uptick in signed contracts, indicating that April could see another increase in sales.
Taken together, the data signals that the spring market could be more resilient than originally expected so long as inflation risks — or even the perception of them — remain under control, according to Brad Case, chief residential economist at Homes.com.
"Demand hasn’t disappeared — it’s been waiting for conditions to feel workable again," Case wrote in a LinkedIn post. "The takeaway: Spring demand is proving resilient, but it needs cooperation from both rates and supply. Falling rates help unlock demand; rising inventory helps convert it into closed sales."