Mortgage rates dipped this week after the Federal Reserve held benchmark interest rates steady for the fifth time this year.
The average rate on a 30-year fixed mortgage was 6.72% through the week ending Wednesday, according to data from Freddie Mac. The previous week’s average was 6.74%. Meanwhile, the average 15-year fixed mortgage rate was 5.85%, down from 5.87%.
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“The 30-year fixed-rate mortgage showed little movement, remaining within the same narrow range for the fourth consecutive week,” Sam Khater, Freddie Mac’s chief economist, said in a statement. “Continued economic growth, along with moderating house prices and rising inventory, bodes well for buyers and sellers alike.”
Despite price easing in some markets, mortgage rates near 7% kept the spring homebuying season subdued. Home contract signings slumped 0.8% in June from a month earlier and 2.8% from a year earlier. Contract signings fell in all regions of the country on a monthly and annual basis, except the Northeast.
The trend appears to be continuing. According to data from the Mortgage Bankers Association (MBA), mortgage applications to purchase a home decreased by 6% from the previous week. Refinance applications were down 1%, but were 30% higher than last summer.
“MBA’s forecast is for 30-year fixed mortgage rates to move just a little lower to perhaps 6.5% over the next year, as longer-term rates continue to be impacted by large deficits and debt and the growing issuance of Treasury securities to fund those deficits, which will likely keep mortgage rates near today’s level even as the Fed loosens monetary policy,” Mike Fratantoni, MBA senior vice president and chief economist, said in a statement.
Read more: Where and how to find the lowest mortgage rates right now
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