These Housing Markets Offer Lower Mortgage Rates

Elevated mortgage rates have hindered housing affordability over the last few years, but in some regions, lower mortgage rates are still possible
May 19, 2025
2 min read
6829284 © Brad Calkins | Dreamstime.com
Homes on the water in Alaska
In Alaska, more than 77% of mortgage loans had interest rates below 7% in 2024.

For the last several years, elevated mortgage rates have greatly contributed to the lack of affordability in the housing market. In 2024, 65.1% of all approved home purchase loans had interest rates below 7%, but this differs by region. To determine which housing markets had the highest share of mortgage loans with interest rates below 7%, Construction Coverage analyzed data from the largest 380 metropolitan areas across the U.S.

They found that Alaska was home to the most buyers with sub-7% mortgage rates. In Alaska, 77.3% of fixed-rate mortgages approved in 2024 had rates under 7%. North Dakota follows just behind. In 2024, the share of fixed-rate mortgages with rates below 7% was 75.6%.

Southern states, on the other hand, had the lowest share of mortgages below 7%. At 43.1%, Mississippi had the lowest share of buyers with mortgage rates below 7% in 2024. Mississippi is followed by New Mexico, where 51% of mortgages had rates below 7%.

Local-level data mirrors these broader regional patterns. Several Southern metropolitan areas recorded some of the least favorable borrowing conditions in the nation. In Eagle Pass, TX, only 28.9% of buyers obtained rates below 7%—the lowest share of any metro area. Meanwhile, markets such as Madison, WI and Anchorage, AK stood out for their high share of sub-7% loans, with nearly 80% of borrowers in those cities securing lower rates.

 

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