Mortgage Rates Slip Under 6%

It finally happened. The average 30-year fixed rate fell to 5.98%. That breaks a line that held for more than three years. The last time you saw a number starting with five was September 2022. Rates now sit far below last year’s 6.76%. And this marks the third straight weekly drop.

Quick Points

• 30-year fixed rate now 5.98%

• First sub-6% reading since 2022

• Rates peaked near 7.8% in 2023

• Refinance activity moved higher

Momentum matters. Buyers watch it. Lenders feel it. A move under 6% shifts the mood heading into spring.

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Spring Market Gets A Jolt

Timing counts. This drop lands right before the spring buying rush. March often brings more listings, more showings, more offers. A lower rate changes math fast. It cuts monthly payments. It can widen what you qualify for. That shift pulls some shoppers off the fence.

You see movement already.

• Applications rose 2.8%

• Refinance demand drove the gain

• Purchase activity slipped

Refinance volume led the charge. Owners who locked in higher rates last year see a window. Buyers still face price pressure, so purchase applications dipped. Still, falling rates tend to pull traffic back over time.

From 2.5% To 7.8% & Back Down

Cast your mind back to 2021. Rates hovered near 2.5%. Cheap money fueled bidding wars. Then policy shifted. The Federal Reserve raised benchmark rates in 2022. Mortgage costs shot up. By October 2023, averages touched about 7.8%.

That spike slowed sales across the country.

• Fed raised rates in 2022

• Peak hit near 7.8%

• Three Fed cuts last year

Over recent months, rates eased. The Fed trimmed its benchmark three times last year. That move helped push mortgage costs lower. Now you see the result on rate sheets.

Also Read: How To Navigate Mortgage Rates & Set Yourself Up for Success

Policy Moves Shape The Market

Washington stepped in this year. In January, President Trump directed Freddie Mac and Fannie Mae to buy $200 billion in mortgage-backed securities. More demand in the secondary market can help lenders price loans lower. That support can ripple through banks and brokers.

Another idea surfaced as well.

• $200B MBS purchase order

• Talk of 50-year mortgages

A 50-year loan would stretch payments over a longer term. That usually means a higher rate and more interest paid across decades. It lowers the monthly bill, yet raises the lifetime cost. Buyers would need to weigh that tradeoff with care.

Prices Stay High & Supply Stays Tight

Lower rates help. Prices still sting. The median U.S. home sale price ended last year at $405,000. Inventory remains thin. New construction has not filled the gap. Builders cite rising costs, which slows new supply.

That imbalance keeps pressure on buyers.

• Median price $405,000

• Limited inventory

• Construction costs weigh on builders

If demand rises and listings lag, prices can climb again. That strains affordability. Some households delay a move. Others rethink life plans tied to housing costs.

Rates under 6% shift the tone. They do not reset the market overnight. Still, this break below a long-held line signals change. For buyers, owners, and lenders, the next few months will tell the story.

Also Read: U.S. Housing Market Lacks 1.5 Million Units, Says Freddie Mac