The average rate on a 30-year fixed mortgage in the United States eased last week after climbing to its highest level in nine months, providing some relief to potential home buyers in a challenging housing market.According to U.S. government-sponsored mortgage finance corporation Freddie Mac, whose weekly survey is widely considered a leading indicator of U.S. home-loan borrowing costs, the average rate on a 30-year fixed mortgage fell to 6.48 percent from 6.53 percent a week earlier, the Associated Press reported.Declining mortgage rates generally increase affordability by lowering borrowing costs and increasing the purchasing power of home buyers. However, rates remain high compared to levels seen earlier this year.The recent change in mortgage rates comes amid ongoing market concerns over inflation and energy prices. Rates have been substantially higher since the outbreak of the Iran conflict, which has disrupted shipping through the Strait of Hormuz, a vital route for global oil supplies.Higher oil prices have stoked inflation concerns, affecting bond markets and borrowing costs. Mortgage rates are generally shaped by several factors, including Federal Reserve policy, inflation expectations, and fluctuations in long-term Treasury yields.The yield on the benchmark 10-year U.S. Treasury note stood at 4.47 percent on Thursday, up slightly from 4.45 percent a week earlier. Before the conflict began in late February, the yield was around 3.97 percent.Mortgage rates generally follow the direction of the 10-year Treasury yield, which lenders use as a benchmark when pricing home loans. Expectations that energy prices may remain high have helped keep long-term bond yields high, limiting the scope for sharp declines in mortgage rates.Earlier this year, the average rate on a 30-year mortgage fell below 6 percent for the first time since the end of 2022. However, borrowing costs have risen again, reaching 6.56 percent last week, their highest level since August.The high rate environment continues to impact the US housing market. Sales of previously owned homes were largely unchanged in April after declining on a year-over-year basis during the first three months of 2026, extending the housing recession that could begin into 2022 as mortgage rates move away from pandemic-era lows.Market participants will get a new perspective on housing demand this week when data on existing home sales for May is released.
