Average long-term US mortgage rate rises to 6.72%, ending a five-week slide

The average rate on a -year U S mortgage edged up this week ending a five-week decline in borrowing costs for homebuyers The long-term rate ticked up to from last week mortgage buyer Freddie Mac disclosed Thursday A year ago the rate averaged Borrowing costs on -year fixed-rate mortgages popular with homeowners refinancing their home loans also rose The average rate increased to from last week A year ago it was Freddie Mac reported High mortgage rates can add hundreds of dollars a month in costs for borrowers and reduce their purchasing power That s helped keep the U S housing arena in a sales slump that dates back to when mortgage rates began to climb from the rock-bottom lows they reached during the pandemic Last year sales of previously occupied U S homes sank to their lowest level in nearly years They ve remained sluggish so far this year as a multitude of prospective homebuyers have been discouraged by elevated mortgage rates and home prices that have continued to climb albeit more slowly Mortgage rates are influenced by several factors from the Federal Reserve s interest rate program decisions to bond realm investors expectations for the financial system and inflation The key barometer is the -year Treasury yield which lenders use as a guide to pricing home loans The yield was at at midday Thursday up from late Wednesday Yields moved up last week as traders bet that a better-than-expected June jobs account could keep the Fed on hold when it comes to interest rates The average rate on a -year mortgage has remained relatively close to its high so far this year of just above set in mid-January The -year rate s low point this year was in early April when it briefly dipped to As mortgage rates eased in new weeks more home shoppers have been encouraged to wade into the realm Mortgage applications jumped last week from the previous week according to the Mortgage Bankers Association Economists generally expect mortgage rates to stay relatively stable in the coming months with forecasts calling for the average rate on a -year mortgage to remain in a range between and this year Mortgage rates may come down modestly over the coming months but other economic headwinds - including the impact of tariffs on the prices of consumer goods weaker labor industry conditions and rising consumer debt - could be what continue to hold the housing sphere in the second half of reported Lisa Sturtevant chief economist at Bright MLS