Mortgage Rates Climb for First Time in a Month, Landing at 6.72%

(Bloomberg) -- Mortgage rates in the US rose for the first time in four weeks.

The average for a 30-year fixed loan was 6.72%, up from 6.6% last week, Freddie Mac said in a statement Thursday.

The Federal Reserve on Wednesday cut its benchmark rate for the third time since mid-September, but signaled a slower pace ahead for any future adjustments. Officials are predicting just two reductions for 2025, a pullback from earlier projections. Fed Chair Jerome Powell said more progress is needed on inflation, which remains above the central bank’s target.

“This may be the last easy cut for a while,” Kara Ng, senior economist at Zillow Home Loans, said after Wednesday’s announcement. “Moving forward, the Fed and markets will likely be in reaction mode to incoming economic data and policy announcements. Homebuyers should expect mortgage rates to continue on their bumpy path and be ready to act when an opportunity arises.”

Sales of previously owned homes in the US rose last month to the fastest pace since March, the National Association of Realtors reported Thursday. The data measure completed purchases, many of which probably went under contract in September, when 30-year mortgage rates hit a two-year low.

That decline “brought shoppers to the market, and the late September surge in rates created a sense of urgency that likely contributed to the uptick,” said Danielle Hale, chief economist for Realtor.com.

Rates this week landed close to where they were at the same time in 2023, according to Sam Khater, Freddie Mac’s chief economist.

“For the most part, mortgage rates have moved between 6% and 7% over the last 12 months,” Khater said in the statement. “Homebuyers are slowly digesting these higher rates and are gradually willing to move forward with buying a home.”