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Mortgage Rates Remain High, but Rate Stability Is Encouraging Buyers

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Mortgage Rates Remain High, but Rate Stability Is Encouraging Buyers

The 30-year, fixed-rate mortgage has been hovering under 6.5% APR for the last few weeks, and homebuyers are using that stability as an opportunity to buy

May 22, 2023
Person crouching beneath weight of mortgage rates
Image: Nuthawut / stock.adobe.com

Mortgage rates have remained within a 10-basis-point range over the last several weeks, averaging 6.39% last week, according to the National Association of Realtors. But while those rates remain high, that stability is instilling more confidence in homebuyers, who are increasingly turning to new construction for design flexibility and greater inventory options. 

In turn, home builder sentiment is on the rise, and so, too, is single-family construction. Mortgage rates are still fluctuating week to week, but experts say borrowing costs are likely to fall throughout the remainder of the year, and paired with increased new-home supply, buyers could soon enjoy a smoother path to homeownership.

“Economic crosscurrents have kept rates within a ten-basis-point range over the last several weeks,” says Sam Khater, Freddie Mac’s chief economist. “After the substantial slowdown in growth last fall, home prices stabilized during the winter and began to modestly rise over the last few months. This indicates that while affordability remains a hurdle, home buyers are getting used to current rates and continue to pursue homeownership.”

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