The average rate on a 30-year U.S. mortgage has fallen to its lowest level in four months, welcome news for prospective homebuyers who have been held back by stubbornly high home financing costs.
The long-term rate fell to 6.63% from 6.72% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.47%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell. The average rate dropped to 5.75% from 5.85% last week. A year ago, it was 5.63%, Freddie Mac said.
Elevated mortgage rates have helped keep the U.S. housing market in a sales slump since early 2022, when rates started to climb from the rock-bottom lows they reached during the pandemic. Home sales sank last year to their lowest level in nearly 30 years.
This is the third week in a row that rates have come down. The latest average rate on a 30-year mortgage is now just above 6.62%, the low point for this year set April 10.
Even so, mortgage rates are not far from their high this year of 7.04%, which was set in mid-January. That's helped keep home sales sluggish so far this year.
Mortgage rates are influenced by several factors, from the Federal Reserve’s interest rate policy decisions to bond market investors’ expectations for the economy and inflation.
The main barometer is the 10-year Treasury yield, which lenders use as a guide to pricing home loans. The yield was at 4.23% at midday Thursday, up slightly from 4.22% late Wednesday.
The yield is well below where it was last week, before Friday’s weaker-than-expected report on the U.S. job market ignited worries that the Trump administration’s tariffs are stalling hiring plans by employers.
Last Wednesday, the central bank’s policymaking committee voted to hold its main interest rate steady. And Fed Chair Jerome Powell pushed back on expectations that the Fed could cut rates at its next meeting in September, noting that inflation remained above the Fed’s 2% target and the job market was “in balance.”
But the latest jobs report may shift that stance. Traders on Wall Street are now betting heavily that the Fed will need to cut interest rates next month, something President Donald Trump has been demanding the Fed, and Powell specifically, to do.
A cut in rates could give the job market and overall economy a boost, but it could also fuel inflation just as Trump’s tariff policies risk raising prices for U.S. consumers.
“While both buyers and sellers welcome lower mortgage rates, it’s not clear whether rates will continue to fall,” said Lisa Sturtevant, chief economist at Bright MLS. “A weaker economy could lead to lower mortgage rates, but the risks of higher inflation could keep rates elevated.”
Home shoppers who can afford to buy at current mortgage rates are benefiting from more homes on the market. That's led to sellers lowering asking prices compared to a year ago in many metropolitan areas, including Miami, Chicago and Los Angeles, according to Realtor.com.
Lower mortgage rates tend to spur more would-be homebuyers to jump into the market, potentially driving home prices higher.
Economists generally expect the average rate on a 30-year mortgage to remain above 6% this year. Recent forecasts by Realtor.com and Fannie Mae project the average rate will ease to around 6.4% by the end of this year.
FILE - A "For Sale" sign is displayed outside a home on Friday, July 11, 2025, in Portland, Ore. (AP Photo/Jenny Kane, File)
DUBAI, United Arab Emirates (AP) — Iranians could call abroad on mobile phones Tuesday for the first time since communications were halted during a crackdown on nationwide protests in which activists said at least 646 people have been killed.
Several people in Tehran were able to call The Associated Press and speak to a journalist there. The AP bureau in Dubai, United Arab Emirates, was unable to call those numbers back. The witnesses said SMS text messaging still was down and that internet users in Iran could connect to government-approved websites locally but nothing abroad.
The witnesses gave a brief glimpse into life on the streets of the Iranian capital over the four and a half days of being cut off from the world. They described seeing a heavy security presence in central Tehran.
Anti-riot police officers, wearing helmets and body armor, carried batons, shields, shotguns and tear gas launchers. They stood watch at major intersections. Nearby, the witnesses saw members of the Revolutionary Guard's all-volunteer Basij force, who similarly carried firearms and batons. Security officials in plainclothes were visible in public spaces as well.
Several banks and government offices were burned during the unrest, they said. ATMs had been smashed and banks struggled to complete transactions without the internet, the witnesses added.
However, shops were open, though there was little foot traffic in the capital. Tehran's Grand Bazaar, where the demonstrations began Dec. 28, was to open Tuesday. However, a witness described speaking to multiple shopkeepers who said the security forces ordered them to reopen no matter what. Iranian state media had not acknowledged that order.
The witnesses spoke on condition of anonymity for fear of reprisal.
U.S. President Donald Trump has said Iran wants to negotiate with Washington after his threat to strike the Islamic Republic over its crackdown.
Iranian Foreign Minister Abbas Araghchi, speaking to the Qatar-funded satellite news network Al Jazeera in an interview aired Monday night, said he continued to communicate with U.S. envoy Steve Witkoff.
The communication “continued before and after the protests and are still ongoing," Araghchi said. However, “Washington’s proposed ideas and threats against our country are incompatible.”
White House press secretary Karoline Leavitt said Iran’s public rhetoric diverges from the private messaging the administration has received from Tehran in recent days.
“I think the president has an interest in exploring those messages,” Leavitt said. “However, with that said, the president has shown he’s unafraid to use military options if and when he deems necessary, and nobody knows that better than Iran.”
Meanwhile, pro-government demonstrators flooded the streets Monday in support of the theocracy, a show of force after days of protests directly challenging the rule of 86-year-old Supreme Leader Ayatollah Ali Khamenei. Iranian state television aired chants from the crowd, which appeared to number in the tens of thousands, who shouted “Death to America!” and “Death to Israel!”
Others cried out, “Death to the enemies of God!” Iran’s attorney general has warned that anyone taking part in protests will be considered an “enemy of God,” a death-penalty charge.
Trump announced Monday that countries doing business with Iran will face 25% tariffs from the United States. Trump announced the tariffs in a social media posting, saying they would be “effective immediately.”
It was action against Iran for the protest crackdown from Trump, who believes exacting tariffs can be a useful tool in prodding friends and foes on the global stage to bend to his will.
Brazil, China, Russia, Turkey and the United Arab Emirates are among economies that do business with Tehran.
Trump said Sunday that his administration was in talks to set up a meeting with Tehran, but cautioned that he may have to act first as reports of the death toll in Iran mount and the government continues to arrest protesters.
“I think they’re tired of being beat up by the United States,” Trump said. “Iran wants to negotiate.”
Iran, through the country’s parliamentary speaker, warned Sunday that the U.S. military and Israel would be “legitimate targets” if Washington uses force to protect demonstrators.
More than 10,700 people also have been detained over the two weeks of protests, said the U.S.-based Human Rights Activists News Agency, which has been accurate in previous unrest in recent years and gave the latest death toll early Tuesday. It relies on supporters in Iran crosschecking information. It said 512 of the dead were protesters and 134 were security force members.
With the internet down in Iran, gauging the demonstrations from abroad has grown more difficult. The Associated Press has been unable to independently assess the toll. Iran’s government hasn’t offered overall casualty figures.
A picture of Ayatollah Ali Khamenei is set alight by protesters outside the Iranian Embassy in London, Monday, Jan. 12, 2026. (AP Photo/Alastair Grant)
In this frame grab from footage circulating on social media shows protesters dancing and cheering around a bonfire as they take to the streets despite an intensifying crackdown as the Islamic Republic remains cut off from the rest of the world, in Tehran, Iran, Friday, Jan. 9, 2026.(UGC via AP)
In this frame grab from footage circulating on social media from Iran showed protesters once again taking to the streets of Tehran despite an intensifying crackdown as the Islamic Republic remains cut off from the rest of the world in Tehran, Iran, Saturday Jan. 10, 2026. (UGC via AP)
FILE - Protesters march on a bridge in Tehran, Iran, on Dec. 29, 2025. (Fars News Agency via AP, File)
