US 30-Year Mortgage Rates Drop For 2nd Week

US Mortgage rates fell for the second straight week, averaging 6.30% as of April 16, down from 6.37% last week, easing borrowing costs during the peak homebuying season. Rates hit a one-month low amid easing geopolitical fears and a record S&P 500, as strong bank and tech earnings overshadowed Middle East tensions. Refinance activity rose, per the Mortgage Bankers Association, while purchase applications stayed subdued, remaining below year-ago levels for the second week, as buyers remained cautious amid economic uncertainty.

Mortgage rates have dropped for the first time since the conflict in Iran began, offering a bit of relief to the U.S. housing market as the spring homebuying season gets underway. The average rate for a 30-year fixed mortgage fell to 6.37% on Thursday, down from 6.46% the previous week and 6.62% in the same period last year. The 10-year Treasury yield, closely tied to mortgage rates, declined following Tuesday’s announcement of a two-week ceasefire. However, analysts caution that the economic fallout from the Iran conflict remains far from resolved.

The average rate on a 30-year fixed mortgage rose by 8bps from the previous week to 6.46% as of April 2nd, the highest in seven months. The increase was aligned with the sharp increase in long-dated Treasury yields, as Iranian forces continued to attack energy tankers in the Middle East and disrupt oil supply for the global economy. The consequent surge in fuel prices stoked pro-inflationary risks and drove multiple FOMC members to project no rate cuts this year.