The 30-year fixed-rate mortgage continues to tick down,” writes Freddie Mac in its weekly mortgage rate report released Thursday. Indeed, the average weekly 30-year-fixed rate mortgage now sits at 6.64%, down slightly from the week prior, and more significantly down from the above-7% rates we saw in January.
In April, mortgages are likely to remain in the 6.5% to 7% neighborhood, says Greg McBride, chief financial analyst at Bankrate.
He adds that “they could fall beneath that range if there were signs of economic weakness but be careful what you wish for.” Ideally, McBride says we like to see mortgage rates fall because inflation pressures are subsiding rather than due to economic weakness, but concerns about inflation are still front and center.
“Mid-6% by the end of the year.” – Kara Ng, senior economist at Zillow Home Loans.
“Over the medium term, absent additional softness in data, Zillow expects mortgages to stay around the mid-6% by the end of the year,” she says.
What’s more, she says mortgage rates create their own seasonality for home shopping season. “Mortgage and refinancing activity picked up in the last week of February and the first week of March, consistent with the increase in engagement observed when rates fell in September 2024. The home shopping season usually begins around spring to early summer, but with the recent dip in mortgage rates, there’s a chance the home shopping season may begin slightly earlier this year,” says Ng.
While the market is short on clarity and high on anxiety, Ng says, “Second or third tier economic data, which in normal times would not get much attention, could have the potential to move interest rates because they can give a timely but imperfect glimpse at how policies are impacting the economy.”
“We’re experiencing the lowest rates in several months. Give it [getting a mortgage] a shot,” says National Association of Realtors Chief Economist Lawrence Yun.
Meanwhile, Yun predicts mortgage rates will hover at 6.5% in April, the lowest since the November election. Indeed, the 30-year fixed-rate mortgage has stayed under 7% for nine consecutive weeks according to Freddie Mac.
Another thing Yun points out that’s worth considering right now is that mortgage rates can suddenly rise if there is a movement to get rid of Fannie Mae and Freddie Mac. “Reforms and bringing them out of conservatorship is fine but not elimination,” says Yun
“If stock prices keep falling, mortgage rates could drop, too,” says Holden Lewis, home and mortgage expert at NerdWallet.
Though mortgage rates are likely predicted to remain level this month, the most important factor in determining exactly where rates go is the stock market: “The S&P 500 has fallen more than 6% since the inauguration and if stock prices keep falling, mortgage rates could drop, too,” says Holden Lewis, home and mortgage expert at NerdWallet.
On the other hand, if consumers and businesses become convinced that tariffs will drive up prices, inflation could remain elevated longer than expected which could move mortgage rates upward, says Lewis.
What might this all mean for home sales?
Dips in mortgage rates, even short ones, encourage home sales. “If mortgage rates stay about the same as forecasted, we will see the normal seasonal increase in home sales. Another factor in home sales is inventory. The more houses that are for sale, the more sales we see. Inventory has been rising and will continue to rise in April [and] increased inventory should keep prices from rising dramatically,” says Lewis.
That said, even a slight drop in rates will bring more buyers to the market. “There are consistent signs that more supply is also reaching the market. This is good for buyers and sellers to see a deeper and wider market,” says Yun.
Even during a traditionally busier spring home-buying season, McBride predicts that high mortgage rates will continue to keep home sales at a subdued level. “It would take a lot of movement in mortgage rates to move the needle on the housing market,” says McBride.
Still, prospective home buyers and especially first-time buyers are experiencing affordability strain due to high home prices and high mortgage rates. “For those that haven’t been priced out, the slower pace of home sales means a better selection of homes to choose from and perhaps some bargaining power,” says McBride.
For home buyers, weighing more options or a greater discount is something Ng likens to trying to buy clothes. “You can shop at the start of the season for the best selection in styles and sizes, but if you don’t mind waiting until the end of the season, you get deep discounts if there’s anything left in your size,” says Ng.
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