Average mortgage rate ticks up for first time in 3 weeks

Elevated mortgage rates, which can add hundreds of dollars a month in costs for borrowers, have discouraged home shoppers, extending the nation’s housing slump into its third year.

A year ago, the rate averaged 6.81%. Five years ago, it was 3.75 percent, according to the Federal Reserve Bank of St. Louis. Adobe Stock

By ALEX VEIGA, Associated Press

July 25, 2024

LOS ANGELES (AP) — Mortgage rates inched higher this week, keeping the average rate on a 30-year mortgage essentially flat and near the 7 percent range it’s been in most of this year.

The rate rose to 6.78 percent from 6.77 percent last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.81%. Five years ago, it was 3.75 percent, according to the Federal Reserve Bank of St. Louis.

Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also edged up this week, pushing the average rate up to 6.07 percent from 6.05 percent last week. A year ago, it averaged 6.11 percent, Freddie Mac said. Five years ago, it was 3.18 percent, according to the Federal Reserve.

“Mortgage rates essentially remained flat from last week but have decreased nearly half a percent from their peak earlier this year,” said Sam Khater, Freddie Mac’s chief economist. “Despite these lower rates, buyers continue to pause, as reflected in tumbling new and existing home sales data.”

After jumping to a 23-year high of 7.79 percent in October, the average rate on a 30-year mortgage has mostly hovered around 7 percent this year — more than double what it was just three years ago.

The elevated mortgage rates, which can add hundreds of dollars a month in costs for borrowers, have discouraged home shoppers, extending the nation’s housing slump into its third year. Sales of previously occupied U.S. homes fell in June for the fourth month in a row. And sales of new single-family homes fell last month to the slowest annual pace since November.