Rates Dip Back Below 7% On Inflation Data

Mortgage rates dipped back below 7% after spiking the week prior, cooling on better-than-expected inflation data.
Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.96%, down from the week prior’s 7.04% and breaking a five-week upward streak.
A year ago at this time, the 30-year fixed-rate mortgage averaged 6.69%.
Fifteen-year rates also decreased to 6.16% from 6.27%. A year ago at this time, they were at 5.96%.
“After crossing the 7%-mark last week, the 30-year fixed-rate mortgage saw its first decline in six weeks,” said Sam Khater, Freddie Mac’s Chief Economist.
“While affordability challenges remain, this is welcome news for potential homebuyers, as reflected in a corresponding uptick in purchase applications.”
Rates are stabilizing after Trump’s slew of day-one executive orders, which featured milder tariff action than analysts feared.
Last week’s inflation data came in cooler than expected, which also had an impact. December’s core consumer price index came in at 3.2%, down slightly from the month prior and better than the 3.3% forecast.
The report also showed shelter prices clocked their smallest YOY gain since January 2022. This metric makes up about a third of the CPI.
“Even this slight dip will offer some relief to homebuyers who are struggling with the combination of elevated mortgage rates and high home prices,” Samir Dedhia, CEO of One Real Mortgage, noted.
“Rates will likely continue to be volatile through the first quarter due to the Trump administration’s potential inflationary policies. The good news is with the new administration already signaling that home affordability could take center stage, there is potential for mortgage relief ahead.”