Borrowers this spring are still operating in a marginally more favorable environment than 12 months ago
Mortgage rates in the United States extended their recent climb this week, with the 30-year fixed-rate benchmark rising to 6.37% for the week ending May 7, a second consecutive weekly increase.
The latest survey from Freddie Mac's Primary Mortgage Market Survey showed the rate up from 6.30% the previous week.
At the same point last year, the same benchmark stood at 6.76%, meaning borrowers this spring are still operating in a marginally more favorable environment than 12 months ago, even as near-term momentum has turned against them.
The 15-year fixed-rate mortgage — a common vehicle for homeowners looking to refinance — moved in tandem, rising to 5.72% from 5.64% a week earlier. A year ago, it averaged 5.89%.
Rates inch back toward spring highs
The two-week rise has reversed most of the improvement that slowly accumulated since late February, when the 30-year average briefly dipped below 6% for the first time since late 2022.
Mortgage rates climbed for five straight weeks after the Iran war began, before pulling back modestly.
The renewed upward pressure this week tracks closely with movements in the 10-year US Treasury yield, which was sitting at approximately 4.37% as of Thursday, reflecting investor attention on the latest developments in the Middle East and their implications for inflation and Federal Reserve policy.
Fed Chair Jerome Powell has signaled the central bank may hold rates steady as officials assess the economic fallout from the war-driven global energy shock, citing uncertainty about whether higher oil prices would reignite inflation or push the economy toward a slowdown.
Read more: Banking giants revise Fed expectations – and one no longer sees a 2026 cut ahead
Signs of life in new-home sales, but headwinds remain
Despite the rate headwinds, Freddie Mac's chief economist Sam Khater struck a cautiously optimistic tone.
“Recent data points to slightly better conditions for buyers with a boost in new-home sales, median new-home prices being down to their lowest level since July 2021, and higher inventory than in recent years. Together, these trends could modestly ease affordability pressures through the spring homebuying season,” he said.
That assessment aligns with what many brokers are reporting on the ground.
Originators have increasingly leaned on monthly payment comparisons rather than headline rates to keep deals moving, with one Texas-based broker telling Mortgage Professional America that buyers at the lower end of the six-percent range are "getting great rates" by recent historical standards.
Read more: What's the 'magic number' that'll get homebuyers off the sidelines?
The latest data arrives at a critical moment for the spring selling season, traditionally the most active stretch of the year for home transactions.
Purchase applications fell 4.4% for the week ending May 1, with the 30-year fixed rate climbing to 6.45%, its highest level in a month, according to the Mortgage Bankers Association.
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