Mortgage rates have been heading down, and now they’re even lower.
The weekly average for a 30-year fixed-rate mortgage fell to 6.35% Thursday, the Federal Home Loan Mortgage Corporation better known as Freddie Mac reported. That’s a drop of 0.15 percentage points from the week ending Sept. 4, the largest in the past year.
Mortgage News Daily posted a 6.29% rate for the same type of mortgage on Friday. Even though that’s a 0.02 percentage point increase from Thursday’s daily index, rates haven’t been that low since October 2024.
But Americans don’t appear to be rushing to buy new homes. Pending home sales increased just 1.1% year over year for the four weeks ending on Sept. 7, Redfin said, the smallest increase in two months,
“Lower Mortgage Rates Trim Hundreds Off Monthly Payments, Yet Homebuyers Are Still Cautious,” read a headline on a post about the rate decline from Redfin, the Seattle-based online brokerage firm.
Purchasing power is up more than $20,000 since mid-summer, according to Redfin, helping to reduce the median U.S. monthly mortgage payment to $2,604, more than $200 below the all-time high set in May.
Yet home prices continue creeping up. Redfin said for the four weeks ending Sept. 7, the median sales price in the U.S. was around $393,000, a 1.7% increase year over year and the second-biggest jump since April.
Kristin Sanchez, a Redfin real estate agent in Nashville, suggested sales are sluggish.
“There’s not a flood of buyers now that mortgage rates are coming down, but I am seeing a trickle as some house hunters do the math and realize rates have dropped enough to fit a monthly payment into their budget,” Sanchez said in the post.
“A lot of house hunters are waiting because they think mortgage rates will drop more when the Fed cuts interest rates in September,” she said. “I’m trying to advise buyers that’s unlikely to happen, and that now is a good time to lock in a rate.”
A cut in interest rates is expected to come when the Federal Reserve meets next week. Chen Zhao, Redfin’s economics research head, said that mortgage rates “are unlikely to fall more” then because the anticipated action by the Fed has already been priced into current rates.
“My message to homebuyers and refinancers: This is what you’ve been waiting for,” Zhao said in a Redfin post last week about homebuyers increased purchasing power. “If you’re serious about locking in a mortgage rate, do it now.”