Rates hold around 6.67% as Fed rate increase fears linger — but brokers say buyers aren't waiting for relief
Average mortgage rates have barely budged in recent weeks, remaining elevated compared with the start of the year as volatility in the bond market continues.
For the week ending August 13, the average 30-year fixed rate clocked in at 6.67%, according to Freddie Mac, marking a tiny decline from the week prior and a jump from 12 months ago when it averaged 6.58%.
The 15-year fixed average is also higher than the same time last year, but Freddie Mac chief economist Sam Khater still sees room for optimism in the current rate environment.
“Housing affordability has improved from a year ago,” Khater said, “and recent increases in purchase and refinance applications suggest that borrowers continue to respond to even modest changes in mortgage rates.”
Why brokers aren't hitting the panic button
Rate relief doesn’t seem to be on the way anytime soon, with financial markets continuing to weigh the prospect of Federal Reserve rate hikes in the months ahead amid rising price pressures caused by the war in Iran.
Capital markets firm Optimal Blue sees mortgage rates ticking up further, forecasting a jump in the 30-year average to 6.76% three months from now followed by a drop back to 6.58% in a year.
But mortgage brokers seem relaxed about that prospect, noting that many hopeful buyers don’t bat an eyelid at slight rate runups and seeing the current rate environment as relatively stable.
“I don’t expect a big change in rates. I don’t expect a big swing,” Fif Ghobadian, senior vice president of mortgage lending at OriginPoint, told Mortgage Professional America. “I expect [rates] to stay the same – maybe drop a tiny bit.”
Existing-home sales have fallen for two consecutive months, according to data released this week by the National Association of Realtors (NAR), and inched slightly lower (by 1.7%) in July.
But national sales are still higher than the same time in 2025, with year-to-date transactions also up (by 2.4%).
Ghobadian said while there’s no sign for buyers that borrowing costs will move materially lower in the near future, plenty are still pushing ahead with a purchase and holding out hopes for rate declines at some point in 2027.
“I do tell people, ‘You get [the rate] now, it will eventually drop,” she said. “I know this administration is laser-focused on dropping these rates eventually, but I certainly don’t expect it this year.”
Iran war keeps inflation fears and rate hike talk alive
The beginning of the war in Iran pushed bond yields higher at the end of February, and they’ve posted a series of spikes since then.
Sporadic good news, and short-lived cessations of hostilities, have briefly calmed financial markets and spurred some housing market optimism.
But tensions have flared up again in recent weeks, and a ceasefire is proving elusive – while oil prices are still elevated amid the continued closure of the Strait of Hormuz, a key shipping channel that’s emerged as a flashpoint in the war.
Those higher prices have stoked fears that they could spill over into other consumer costs, potentially putting upward pressure on inflation (despite good news this week) and leaving Federal Reserve rate hikes on the table.
This week, Fed official Beth Hammack – one of three decisionmakers who dissented at the central bank’s last rates meeting – said it should move rates higher to tackle the growing inflation threat.
The Fed’s decisions don’t directly move mortgage rates, although financial markets often influence bond yields by pricing in expectations of central bank rate cuts or raises.
And Ghobadian said the looming risk of Fed hikes at some point is part of the reason she doesn’t see mortgage rates dropping anytime soon, even if she doesn’t expect borrowing costs to surge either.
“The Fed is battling their fears of inflation and there are expectations of a rate hike this year,” she said. “So I don’t expect anything super dramatic this year in terms of big changes in rates, going super high or coming down.”
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