Mortgage Rates Are Hitting Their Lowest Point in Nearly a Year

by Austin Rowe

If you’ve been watching the housing market, or sitting on the sidelines waiting for a better moment, here’s some good news: mortgage rates have dropped to their lowest levels in almost a year.

As of last week, the average 30-year fixed mortgage is sitting around 6.35%, according to Freddie Mac. That’s the lowest we’ve seen since October 2024. The Mortgage Bankers Association (MBA) is reporting the same trend, with their survey showing rates at 6.49% and it’s sparked a big jump in mortgage applications, both for buyers and refinancers.

Why Are Rates Dropping?

A few big things are happening:

Treasury Yields Are Falling → Mortgage rates follow long-term Treasury yields, and as those have dropped, borrowing costs have come down too.
Economic Signals Are Softening → Recent job numbers and other data point to a cooling economy. That’s pushing investors to expect the Federal Reserve will start cutting rates soon.
Fed Policy Outlook → The market is betting on the Fed stepping in to ease rates and mortgage lenders are already reacting.

What This Means for You

Refinancers: If you bought or refinanced when rates were closer to 7% (or higher), this is the first real window we’ve had in a while to improve your monthly payment. That’s why refinance applications just surged to almost half of all new mortgage activity.
Buyers: You’ve got a little more breathing room. While housing affordability is still tight in many markets, rates like these can make a noticeable difference in what you qualify for.

Is This Really a Two-Year Low?

Not quite. Headlines love big numbers, but the truth is we’re at an 11-month low, not a full two years. Still, this is the best opportunity buyers and homeowners have had in months and it’s enough to shift momentum back into the market.

My Take

If you’ve been waiting for the right time to make a move, this might be it. Rates in the mid-6s don’t sound as flashy as the sub-3% days of the pandemic (and we’re not heading back there anytime soon), but compared to what we’ve seen the past year, this is a meaningful improvement.

The key takeaway: don’t wait for “perfect.” If the numbers work for you now, whether that’s buying your first home, upgrading, or refinancing, it’s worth running the math.