Washington DC tourists are unhappy with the construction of the White House
Zach Anderson, USA TODAY’s White House correspondent, told tourists who flocked to the White House to see the construction site.
Housing market activity is responding as mortgage rates hit their lowest levels in more than a year. However, unless interest rates fall significantly further, upside from here may be limited.
Freddie Mac announced on October 23 that the national average interest rate for 30-year fixed-rate mortgages was 6.19% over the past week. This was the fourth consecutive week of declines and the lowest level for the most popular mortgage product since early October 2024.
Lower rates are beneficial to prospective buyers. According to Redfin analysis, the typical monthly payment in the U.S. is $2,556, which is little more than a year ago. The brokerage firm estimates that buyers’ purchasing power has increased by $9,500 compared to a month ago, when interest rates were hovering around 6.4%.
Buyers are jumping at the opportunity. The National Association of Realtors announced Thursday, Oct. 23, that sales of existing homes were 1.5% higher in September than in August. Data on new home sales is compiled by the Census Bureau, but remains on hold during the government shutdown.
For customers with traditional 30-year fixed-rate mortgages, more than 60% of current locks are below 6%, said Bill Emerson, president of Rocket Companies, and those borrowers often have to use points or other methods to get lower rates.
“This is the consumer response,” Emerson told USA TODAY. “They are willing to buy into lower interest rates.”
But the bigger question is: What drives more homeowners to sell?
Mortgage interest rates fell to 6.08% in September last year, but since then they have bottomed out and started rising steadily, Emerson noted. “We’re seeing some additional movement in margins” now, he said, adding: “I think sellers may want to wait for rates to be lower and more stable.”
Michael Micheletti, chief marketing officer at fintech company Unlock, agrees.
If interest rates were in the mid-5% range, he said, “the neighborhood would be forced out,” but “everyday American homeowners would wait it out if they could.”
Unlock is best known for structuring home equity deals that allow owners to tap into what they’ve accumulated in exchange for cash. Micheletti said consumers who call the company with questions or to initiate the process are often struggling.
“Most homeowners still believe that the macro picture suggests some kind of recession ahead,” he said. Between medical costs, childcare costs, groceries, transportation costs, and more, “stress is real for American families at this time.”
