30-year mortgage rate drops to 7.24%, easing cost pressure on buyers

U.S. home loan costs have risen sharply since early 2026, but the trend reversed this week as major benchmark rates declined.

The average 30-year fixed-rate mortgage dropped to 7.24% this week, down from 7.32% the previous week, according to Freddie Mac. This marks the lowest level for the benchmark rate in more than a month. A year ago, the same rate stood at 6.17%.

Borrowers seeking to refinance existing loans also saw a decrease in costs. The average rate for 15-year fixed-rate mortgages fell to 6.60% from 6.68% last week. For context, the 15-year rate was 5.41% one year ago.

The decline follows a period of rising rates that began in late February. The onset of the U.S. war with Iran at that time drove up oil prices and inflation, which in turn pushed mortgage rates higher. Bond market volatility also contributed to the increase by raising yields on U.S. Treasurys.

The 10-year Treasury yield, which lenders use as a guide for pricing home loans, has eased this month. It reached its highest level since 2002 earlier this month before settling back. As of Thursday at midday, the 10-year yield stood at 4.98%. This figure remains well above the 3.97% level recorded before the war with Iran began.

Higher borrowing costs have stalled U.S. home sales this year. The increase in rates since late February has added approximately $350 to the monthly payment for a borrower financing a $400,000 home loan. This rise in monthly costs has limited purchasing power, causing many prospective buyers to delay their plans. The housing market has faced a slump since 2022, when rates began climbing from pandemic-era lows, leaving sales of previously occupied homes stuck at a 30-year low.

While the current average rate provides a baseline, individual borrower rates can vary based on income, credit history, and other factors. Some borrowers may qualify for rates below or above the reported average.