U.S. Mortgage Rates Fall Slightly, Remain Elevated

U.S. mortgage rates have declined for a third straight week, with 30-year fixed rates now ranging between 6.81% and 6.86%, a slight drop from recent highs. The decrease is largely due to lower 10-year Treasury yields and continued economic uncertainty, including persistent inflation and geopolitical issues. Although rates are down from their peak, they remain well above the pandemic-era lows, limiting homebuyer purchasing power and depressing home sales. The Federal Reserve's decision to keep the federal funds rate unchanged has helped maintain rate stability, but mortgage rates are primarily driven by investor sentiment and bond market trends. Most analysts predict that rates will remain in this elevated range, with little chance of returning to sub-3% levels soon. Elevated borrowing costs continue to constrain housing market activity and affordability.