Recent data shows the average 30-year fixed mortgage rate in the U.S. has fallen to 6.06%, the lowest level since late 2022. This drop marks a potential turning point for a housing market long strained by affordability challenges.
Policy Measures Fuel Rate Decline
For years, elevated borrowing costs kept both buyers and sellers on the sidelines. Now, a newly launched $200 billion agency mortgage-backed securities purchase program appears to be taking effect. Designed to improve housing accessibility, the initiative has helped ease long-term lending rates and restore some market confidence.
Signs of Broader Recovery
Beyond lower rates, other market indicators are improving:
- Home inventory has modestly increased, easing supply constraints
- Price growth has stabilized after rapid appreciation
- Buyer inquiries and showings are on the rise
Obstacles Remain
Despite progress, experts caution that recovery is fragile. Millions of homeowners still hold ultra-low-rate mortgages from previous years. Upward pressure on rates makes upsizing or relocating financially unattractive, leading to historically low turnover.
For a true market unlock, sustained rate reductions are essential to encourage existing owners to list homes, thereby fueling broader transactional activity.