July 24, 2024

What is the average interest rate on a 30-year mortgage in the U.S.?

CLEVELAND, Ohio — U.S mortgage rates have declined slightly for the second straight week, but are still near 7% on average.

The average rate on a 30-year fixed mortgage was 6.95% Thursday, according to Freddie Mac, a government-sponsored home-loan agency. This is down from 6.99% last week and 7.03% the year before. Rates on a 15-year fixed mortgage were 6.17%, down from 6.36% two weeks ago.

“Mortgage rates continued to fall back this week as incoming data suggests the economy is cooling to a more sustainable level of growth,” said Sam Khater, Freddie Mac’s chief economist.

Khater said that inflation numbers were flat, referring to May’s inflation numbers that were released Wednesday. Year-over-year inflation was 3.3%

But shelter-inflation, which measures rent and the cost of owning a home, increased. Khater said this is “showing that housing affordability continues to be an ongoing impediment for buyers on the house hunt.”

While interest rates have remained pretty stable, just a small movement means a sizable difference in a monthly payment.

On a fixed rate 30-year loan at 6.95%, a buyer would pay $993 a month in principal and interest for a $150,000 loan. Interest would add up to $207,500 over 30 years.

At 6.62%, where rates started off in 2024, the same loan would be $960 each month and $196,000 in interest over the life of the loan.

This doesn’t include other costs like home insurance, PMI and property taxes.

Average interest on a 30-year mortgage peaked at 7.79% in 2023. Interest rates have skyrocketed since January 2022, when the 30-year rate averaged 3.22%, and a 15-year rate averaged 2.43%.

Sean McDonnell is the business reporter for cleveland.com and the Plain Dealer. You can reach him at smcdonnell@cleveland.com.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “Accept All”, you consent to the use of ALL the cookies. However, you may visit "Cookie Settings" to provide a controlled consent. View more