Mortgage rates drop as bond market stabilizes

Mortgage rates fell this week amid a period of relative stability for the bond market.

The average 30-year mortgage rate was 6.76% this week through Wednesday, down from 6.81% a week earlier, according to Freddie Mac data. 15-year mortgage rates averaged 5.92%, compared with 5.94% last week.

After several weeks of volatility, 10-year Treasury yields, which closely track mortgage rates, are starting to move lower once again. They’re around 4.2% as of Thursday morning, from 4.31% a week ago.

Mortgage rates have been on a bumpy path since President Trump announced sweeping tariffs in early April, but they’re settling now as markets await more information about the likely path of benchmark interest rates.

“The small dip in mortgage rates may help a potential buyer who is shopping on the edge of what they can afford move into their next home,” Kara Ng, senior economist at Zillow Home Loans, said in a statement. “For buyers who are comfortable moving forward, the market is looking friendlier.”

The Federal Reserve is broadly expected to keep interest rates flat at its meeting next week amid mixed economic signals. New data released Wednesday showed the US economy shrank in the first quarter, while inflation was hotter than expected. The Fed doesn’t directly control mortgage rates, but they are influenced by expectations about future central bank policy decisions.

For now, mortgage rates remain elevated from last month’s year-to-date lows, and that’s likely keeping some buyers sidelined during the traditionally busy spring homebuying season. Applications to purchase a new home dropped 4% through Friday from a week earlier, while refinancing applications also fell 4%, according to the Mortgage Bankers Association.