The average long-term U.S. mortgage rate fell again this week but remain high compared to earlier in the spring homebuying season, according to weekly data compiled by mortgage buyer Freddie Mac.
The rate on the 30-year fixed mortgage fell to 6.69% this week from 6.71% a week ago. One year ago, it averaged 5.78%.
"Mortgage rates decreased slightly this week in anticipation of the pause in rate hikes by the Federal Reserve," said Sam Khater, Freddie Mac’s Chief Economist.
Khater continued, "As inflation continues to decelerate, economic growth is slowing and the tightening cycle of monetary policy is reaching its apex, which means mortgage rates are expected to decrease later this year and into next."
In addition, the average rate on a 15-year fixed mortgage rose to 6.10% this week from 6.07% a week ago. At this time last year, the 15-year fixed-rate mortgage averaged 4.81%.
The Federal Reserve indicated it will raise rates two more times this year, quashing any optimism that a terminal rate had been reached.
The Fed rate hiking cycle has increased the cost of borrowing in an attempt to reduce the velocity of money and slow the economy.
Jerome Powell's announcement yesterday of future interest rate hikes came as a blow to homebuyers who will continue to fight an uphill bad in the coming months.
Despite spring and summer being the peak home buying season, home sales have been far below the historical figures as the market remains tight.