Mortgage Rates Continue Their Sinking Streak, Dropping 7 Consecutive Days to New 2025 Low
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Mortgage rates for 30-year loans dropped for a seventh day Friday, reducing the average to 6.55%. That’s now the lowest reading since early December. Rate movement was down for many other mortgage types as well.
Since rates vary widely across lenders, it’s always smart to shop around for your best mortgage rate and compare rates regularly, no matter the type of home loan you seek.
Rates on 30-year new purchase mortgages have fallen daily for seven consecutive days, with a Friday decline lowering the average to 6.55%. That’s now almost a 30-point drop since Feb. 19, and takes the average to its most affordable level since Dec. 9.
Back in September, 30-year rates plummeted—sinking as far as a two-year low of 5.89%. In the ensuing three months, however, the average surged almost 1.25 percentage points—before recently moving lower.
Rewinding further, the 30-year average notched a high 7.37% last spring, so today’s rates are significantly improved vs. 11 months ago. They’re also nearly 1.45 percentage points cheaper than the historic 23-year peak of 8.01% reached in October 2023.
Rates on 15-year mortgages subtracted 5 basis points Friday to average 5.68%—now its lowest level in more than four months. Like its 30-year cousin, the 15-year average sank to a two-year low back in September, falling as far as 4.97%. Though today’s 15-year average is elevated, it remains 1.4 percentage points under October 2023’s historic 7.08% reading—a high since 2000.
Jumbo 30-year mortgage rates meanwhile shed 2 basis points Friday, dropping to a 6.65% average. Like standard 30-year rates, the jumbo average is at its cheapest level since December. Back in September, jumbo 30-year rates plummeted to a 19-month low of 6.24%. Meanwhile, it’s estimated that the 8.14% peak of October 2023 was the most expensive jumbo 30-year average in 20-plus years.
Every Thursday, Freddie Mac, a government-sponsored buyer of mortgage loans, publishes a weekly average of 30-year mortgage rates. Last week’s reading dropped 9 basis points, lowering the average to 6.76%. As recently as Sept. 26, the average had sunk as far as 6.08%.
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Back in October 2023, however, Freddie Mac’s average saw a historic rise, surging to a 23-year peak of 7.79%.
Freddie Mac’s average differs from what we report for 30-year rates because Freddie Mac calculates a weekly average that blends five previous days of rates. In contrast, our Investopedia 30-year average is a daily reading, offering a more precise and timely indicator of rate movement. In addition, the criteria for included loans (e.g., amount of down payment, credit score, inclusion of discount points) varies between Freddie Mac’s methodology and our own.
Calculate monthly payments for different loan scenarios with our Mortgage Calculator.
The rates we publish won’t compare directly with teaser rates you see advertised online since those rates are cherry-picked as the most attractive vs. the averages you see here. Teaser rates may involve paying points in advance or may be based on a hypothetical borrower with an ultra-high credit score or for a smaller-than-typical loan. The rate you ultimately secure will be based on factors like your credit score, income, and more, so it can vary from the averages you see here.
Your monthly mortgage payment will depend on your home price, down payment, loan term, property taxes, homeowners insurance, and interest rate on the loan (which is highly dependent on your credit score). Use the inputs below to get a sense of what your monthly mortgage payment could end up being.
Mortgage rates are determined by a complex interaction of macroeconomic and industry factors, such as:
Because any number of these can cause fluctuations simultaneously, it’s generally difficult to attribute the change to any one factor.
Macroeconomic factors kept the mortgage market relatively low for much of 2021. In particular, the Federal Reserve had been buying billions of dollars of bonds in response to the pandemic’s economic pressures. This bond-buying policy is a major influencer of mortgage rates.
But starting in November 2021, the Fed began tapering its bond purchases downward, making sizable reductions each month until reaching net zero in March 2022.
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Between that time and July 2023, the Fed aggressively raised the federal funds rate to fight decades-high inflation. While the fed funds rate can influence mortgage rates, it doesn’t directly do so. In fact, the fed funds rate and mortgage rates can move in opposite directions.
But given the historic speed and magnitude of the Fed’s 2022 and 2023 rate increases—raising the benchmark rate 5.25 percentage points over 16 months—even the indirect influence of the fed funds rate has resulted in a dramatic upward impact on mortgage rates over the last two years.
The Fed maintained the federal funds rate at its peak level for almost 14 months, beginning in July 2023. But in September, the central bank announced a first rate cut of 0.50 percentage points, and then followed that with quarter-point reductions in November and December.
For its first meeting of the new year, however, the Fed opted to hold rates steady—and it’s possible the central bank may not make another rate cut for months. At their Dec. 18 meeting, the Fed released its quarterly rate forecast, which showed that, at that time, the central bankers’ median expectation for the coming year was just two quarter-point rate cuts.
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With a total of eight rate-setting meetings scheduled per year, that means we could see multiple rate-hold announcements in 2025.
The national and state averages cited above are provided as is via the Zillow Mortgage API, assuming a loan-to-value (LTV) ratio of 80% (i.e., a down payment of at least 20%) and an applicant credit score in the 680–739 range. The resulting rates represent what borrowers should expect when receiving quotes from lenders based on their qualifications, which may vary from advertised teaser rates. © Zillow, Inc., 2024. Use is subject to the Zillow Terms of Use.
Today’s New Purchase Mortgage Rate Averages
The Weekly Freddie Mac Average
What Causes Mortgage Rates to Rise or Fall?
How We Track Mortgage Rates
| National Averages of Lenders’ Best Mortgage Rates | |
|---|---|
| Loan Type | New Purchase |
| 30-Year Fixed | 6.55% |
| FHA 30-Year Fixed | 6.76% |
| 15-Year Fixed | 5.68% |
| Jumbo 30-Year Fixed | 6.65% |
| 5/6 ARM | 7.15% |
| Provided via the Zillow Mortgage API | |
| National Averages of Lenders’ Best Rates – New Purchase | ||
|---|---|---|
| Loan Type | New Purchase Rates | Daily Change |
| 30-Year Fixed | 6.55% | -0.04 |
| FHA 30-Year Fixed | 6.76% | No Change |
| VA 30-Year Fixed | 6.06% | -0.05 |
| 20-Year Fixed | 6.27% | No Change |
| 15-Year Fixed | 5.68% | -0.05 |
| FHA 15-Year Fixed | 6.46% | No Change |
| 10-Year Fixed | 5.61% | +0.07 |
| 7/6 ARM | 7.11% | -0.05 |
| 5/6 ARM | 7.15% | -0.05 |
| Jumbo 30-Year Fixed | 6.65% | -0.02 |
| Jumbo 15-Year Fixed | 6.72% | -0.05 |
| Jumbo 7/6 ARM | 7.00% | -0.05 |
| Jumbo 5/6 ARM | 7.00% | +0.01 |
| Provided via the Zillow Mortgage API | ||
Will mortgage rates allow for ‘peak’ homebuying season?
Announcing the 2025 Finance Leaders
Pending home sales are down 3% YoY, a decline from +5% YoY in Q4 2024
Over the last two months with economic uncertainty, the bond market has responded and the yield for the 10-year Treasury has declined by 60 basis points from 4.8% to 4.2%. The 30-year fixed mortgage has followed suit, recently falling as low as 6.75%, the lowest level since mid-December.
It’s quite obvious that stubbornly high mortgage rates slowed down early season homebuyers in the first quarter of 2025. Our weekly pending home sales data continues to run about 3% below last year.
This is after Q4 2024 was 5% above the year prior. That’s a pretty notable swing.
So, mortgage rates have been declining for several weeks now. In fact, mortgage rates are cheaper than they were at the same point a year ago. Now, as always with swings in the cost of money, we watch for signals of homebuyers taking advantage of opportunity. If we’re lucky and mortgage rates keep falling, the question is if we’ll be able to measure any turnaround with homebuyer demand soon.
Unfortunately, I think we’re a ways off still from a meaningful shift in housing demand trends. Last year as rates eased down from 7.5% to 6.5%, I expected some improvement in demand. But we didn’t really see any change in the buyer demand metrics until rates got closer to 6%. Last week at HousingWire’s Housing Economic Summit in Dallas, I shared the data on why I expect that the same 6% threshold will be what we’re facing in 2025.
The added wrinkle this year is that lower rates are being driven by weaker assessments of the economy and jobs. By some measures, the U.S. economy is slowing dramatically right now. Look at the Atlanta Fed’s GDPNow data, for example. A slower economy probably leads to cheaper mortgage rates, but it also means fewer people are employed and incomes stop growing.
In the last three years, everyone has been employed in this country. We’ve had super high employment. So when mortgage rates move cheaper, potential homebuyers are fairly optimistic about their personal situations and they jump to take advantage. This is what happened last September. But now if mortgage rates move lower because unemployment spikes, and the economy shrinks, then it remains to be seen how much a 50-basis point decline in mortgage rates motivates people in a more pessimistic macro economy. People have to balance the cost of money with things like job security when they’re buying houses.
The thing to keep in mind for the housing market as we roll into March is that mortgage rates have been easing down. The real time home sales data that we track does not yet show any response, however.
In fact, as of the end of February, the sales and home price data continue to look very weak, even compared to the lows of 2024.
Let’s look at this week’s data, starting with the active inventory of homes for sale right now.
Total available inventory dipped this week to 639,000 single-family homes on the market. That’s fractionally fewer than a week ago. There are 28% more homes on the market now than a year ago.
The purple line in this chart is 2025, you can see that nationally there are plenty more homes unsold on the market than 2024. During the second quarter last year, inventory rose quickly because mortgage rates rose quickly and peaked in May. This year, if we’re lucky, mortgage rates will continue to ease down, so while there are 28% more homes on the market now than a year ago, by the end of May that spread could be down to around 22%. Inventory grew faster last year.
We usually focus on the single-family data in these videos, but it’s worth pointing out that the unsold inventory of condos and townhomes is 33% more than last year at this time. There are 193,000 on the market. Condo inventory has been growing slightly faster than single-family houses. While single-family listings are still 22% fewer than February of 2019, the unsold inventory of condos is roughly back to the old normal levels. In February 2019 there were 194,000 on the market.
In fact, you have to go back to 2016 before you can find a year with consistently more unsold condos than we have now around the U.S. Also, while the available supply of single-family homes shrank a little this week, the inventory of condos grew by about 1%.
What’s fascinating is that 36% of all the condos and townhomes for sale in the U.S. are in Florida, and there are a lot of Florida condos on the market. Of the 194,000 condos on the market in the US, 70,000 of those are in Florida.
In most of the country, condos are a pretty small percent of the market. Single-family homes dominate the market, but it’s worth checking in on the condo market occasionally.
New listings also dipped for the second week in a row. There’s probably some weather effects in there, and I expect to see a jump in the new listings volume in next week’s data.
There were just over 53,000 new listings unsold, plus another 10,000 new listings immediate sales. That comes to 2% more unsold new listings and actually 5% fewer sellers overall than in 2024. That’s three out of the last four weeks with fewer sellers now than in 2024.
In this chart we’re looking at the unsold new listings. I like this view because even though there are fewer sellers overall, more of the listings are actually adding to active inventory. You can see the purple line is tracking just above the blue line from last year. Each week there’s a few percent more homes than we saw a year ago.
The most important takeaway from the weekly new listings data is what it’s not doing. There are simply not a lot of homesellers across the country. Even in the slowest markets in the country, like Florida, for example, while there are plenty of unsold homes on the market, there’s not a rush of sellers adding to that. That fact keeps a lid on inventory growth across the country.
As we roll into spring, weekly home sales should start climbing. This week saw the most newly pending sales all year but sales are still trailing 2024. There were just over 60,000 newly pending sales for single-family homes this week, which is up almost 7% for the week but is still 3% fewer than the same week a year ago.
Sales should climb each week now through the Easter holiday week. Easter is late this year, so that’s something to note of for March as we watch the numbers roll in.
In the chart here we’re tracking the real time counts of the newly pending home sales each week. The purple line continues to show just no growth in sales activity compared to 2024. As you can see, we should expect weekly rapid growth in home sales for March as the spring season warms up.
There are 324,000 single-family homes in contract to sell right now. That’s 3.75% more than last week and is running 3% fewer than last year at this time. A lot of sales close right at the end of the month, so next week will probably dip in total pending sales even as the weekly numbers increase.
The takeaway from the pending sales numbers is that it takes roughly 35 days on average for sales to close, so homes in contract now will generally close in March. We know there are fewer homes in contract than last year at the end of February so we have visibility that home sales for Q1 2025 will come in below Q1 of 2024.
That’s counter to our forecast for the year. Back in the fall when we published our HousingWire forecasts, we were expecting slight home sales growth for 2025. Sales could still improve slightly if mortgage rates continue to fall, but that change has to happen quickly because Q2 is the seasonal peak for home sales.
The median price of those newly pending contracts came in at $389,900 this week. That’s a bump up of 1% for the week and is just 2.6% greater than a year ago.
You can see the purple line for 2025 is in the seasonal climb. The best homes and the most buyers are here in the spring, so prices inch higher. Given the season, I’d expect prices to step higher in the next few weeks but there are many signals of price weakness and low buyer demand. I would not be surprised if we get less seasonal lift than usual in March.
This is a national median price of all the homes in the country that got offers and went into contract this week. Nationally, prices are slightly ahead of last year. Some markets have higher home prices and plenty have lower home prices than in the spring of 2024. As I mentioned, condo inventory is climbing faster than houses, and condo prices are weaker. Nationally, condo prices are unchanged from last year. In Florida, the median price for condos is actually 4% below last year.
This is imporant because local markets can behave very differently from one another. There are many years when things are moving in concert. Right now, however, some markets have plenty strong price appreciation while others have falling home prices.
The leading indicators for future sales prices continue to be weak with no signs of any turnaround in the price reductions. The percentage of homes on the market with a price cut from the original list price is 33.7% now. That’s up 50 basis points on the week and is notably higher than last year at this time.
In the chart here, the purple line for 2025 has an obvious trend. There are more homes on the market now with price reductions than any recent February. Price cuts are increasing.’
New listings are pretty low, so there’s not a lot of fresh inventory. Fresh inventory doesn’t need a price cut for a month or more.
The withdrawn listings are pretty high too. For homes that are on the market and don’t get an offer, you can cut your price to try to stimulate demand, or you can withdraw the listing and hopefully test the market again in the future.
I was looking at a San Francisco condo this weekend. It’s listed for 15% less than it sold for in 2015, ten years ago. It’s been withdrawn and relisted with a lower price 4 times in the past year. Sometimes, sellers are trying to game the system with a withdrawal. On most MLSs, if the property has been off the market for maybe 30 days, they’ll reset the days on market and original list price. In the Altos data, we track total days on market. So while this condo officially shows as a new listing, in the Altos data we show nearly 400 days on market. At some point this property will be a buy. It’s a super cool space and it will be fascinating to see the price point.
That’s all the time we have for today’s data. If you need to communicate about this market with your buyers and sellers, you should join us at Altos Research.
2025 could be the last year of inventory shortage
February 24, 2025
In “Data & Visuals”
Mortgage rate volatility has slowed, but a big decline in 2025 is unlikely
February 25, 2025
In “LendingLife”
More chilly data on the housing market: Pending home sales drop
February 27, 2025
In “Housing Market”
Rumors that Keller Williams is considering an initial public offering (IPO) have circulated since the dawn of time — or at the very least, over the past few decades. But until now, the rumors have appeared to be nothing more than speculation.
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Mortgage rates are down across the board right now. According to Zillow, the 30-year fixed mortgage rate has dropped by four basis points to 6.27%, and the 15-year fixed interest rate has decreased by four basis points to 5.57%. The 5/1 adjustable mortgage rate has inched down by two basis points to 6.53%.
Historically, introductory rates on adjustable-rate mortgages (ARMs) have been lower than fixed rates. However, average ARM rates are starting higher than fixed ones right now. Even in the current high-rate environment, a fixed mortgage rate could be a better deal. However, be sure to look at your options with several mortgage lenders before choosing a loan type.
Have questions about buying, owning, or selling a house in today’s market? Submit your question to Yahoo’s panel of Realtors using this Google form.
Dig deeper: Fixed-rate vs. adjustable-rate mortgage — Which should you choose?
Here are the current mortgage rates, according to the latest Zillow data:
30-year fixed: 6.27%
20-year fixed: 5.98%
15-year fixed: 5.57%
5/1 ARM: 6.53%
7/1 ARM: 6.62%
30-year VA: 5.72%
15-year VA: 5.18%
5/1 VA: 5.91%
Remember, these are the national averages and rounded to the nearest hundredth.
Read more: How are mortgage rates determined?
These are the current mortgage refinance rates, according to the latest Zillow data:
30-year fixed: 6.27%
20-year fixed: 5.88%
15-year fixed: 5.58%
5/1 ARM: 6.73%
7/1 ARM: 6.84%
30-year VA: 5.68%
15-year VA: 5.33%
5/1 VA: 6.09%
30-year FHA: 6.06%
Again, the numbers provided are national averages rounded to the nearest hundredth. Although it’s not always the case, mortgage refinance rates tend to be a little higher than purchase rates.
You can use the free Yahoo Finance mortgage calculator to play around with how different terms and rates will affect your monthly payment. Our calculator considers factors like property taxes and homeowners insurance when estimating your monthly mortgage payment. This gives you a better idea of your total monthly payment than if you just looked at mortgage principal and interest.
Today’s average 30-year mortgage rate is 6.27%. A 30-year term is the most popular type of mortgage because by spreading out your payments over 360 months, your monthly payment is relatively low.
If you had a $300,000 mortgage with a 30-year term and a 6.27% rate, your monthly payment toward the principal and interest would be about $1,851, and you’d pay $366,380 in interest over the life of your loan — on top of that original $300,000.
The average 15-year mortgage rate is 5.57% today. Several factors must be considered when deciding between a 15-year and 30-year mortgage.
A 15-year mortgage comes with a lower interest rate than a 30-year term. This is great in the long run because you’ll pay off your loan 15 years sooner, and that’s 15 fewer years for interest to compound.
However, because you’re squeezing the same debt payoff into half the time, your monthly payments will be higher.
If you get that same $300,000 mortgage but with a 15-year term and a 5.57% rate, your monthly payment would jump up to $2,462 — but you’d only pay $143,233 in interest over the years.
Dig deeper: How much house can I afford? Use our home affordability calculator.
With an adjustable-rate mortgage, your rate is locked in for a set period of time and then increases or decreases periodically. For example, with a 5/1 ARM, your rate stays the same for the first five years, then changes every year.
Adjustable rates usually start lower than fixed rates, but you run the risk that your rate goes up once the introductory rate-lock period is over. But an ARM could be a good fit if you plan to sell the home before your rate-lock period ends — that way, you pay a lower rate without worrying about it rising later.
ARM rates have also been higher than fixed rates lately. Before dedicating yourself to a fixed or adjustable mortgage rate, be sure to shop around for the best lenders and rates. Some will offer more competitive adjustable rates than others.
Mortgage lenders typically give the lowest mortgage rates to people with higher down payments, excellent credit scores, and low debt-to-income ratios. So if you want a lower rate, try saving more, improving your credit score, or paying down some debt before you start shopping for homes.
You can also buy down your interest rate permanently by paying for discount points at closing. A temporary interest rate buydown is also an option — for example, maybe you get a 6% rate with a 2-1 buydown. Your rate would start at 4% for year one, increase to 5% for year two, then settle in at 6% for the remainder of your term.
Just consider whether these buydowns are worth the extra money at closing. Ask yourself whether you’ll stay in the home long enough that the amount you save with a lower rate offsets the cost of buying down your rate before making your decision.
Here are interest rates for some of the most popular mortgage terms: According to Zillow data, the national average 30-year fixed rate is 6.27%, the 15-year fixed rate is 5.57%, and the 5/1 ARM rate is 6.53%.
A normal mortgage rate on a 30-year fixed loan is 6.27%. However, keep in mind that’s the national average based on Zillow data. The average might be higher or lower depending on where you live in the U.S.
While mortgage rates could inch down here and there, they will probably not significantly drop in 2025.
A rate-and-term refinance replaces your original mortgage with a new one with a different mortgage rate and term length. Find out if it’s a good fit.
Want to get a mortgage on a $500,000 home? Learn what your monthly mortgage payment and long-term costs will be to determine if you can afford a $500,000 house.
When you can refinance a mortgage depends on your loan type. You may have to wait up to 12 months. Learn how soon you can refinance your mortgage.
A buydown interest rate program lets you pay extra at closing for a lower mortgage rate, either permanently or temporarily. Learn how to buy down your rate.
Refinancing a mortgage hurts your credit, but the effects are usually small and go away quickly. Learn how to prepare for a refinance to affect your credit.
There are several types of home refinance options, including cash-out, no-closing-cost, and more. Learn which type of refinance is best for your financial goals.
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