Instant Reaction: Mortgage Rates, May 16, 2024

Depending on one's outlook, mortgage rates from Freddie Mac today are either a bright spot or a weak spot. Fact: the 30-year fixed mortgage interest rate averaged 7.02% over the last week. At 7.02%, a mortgage payment on a $400,000 home with 10% down is $2,400 and $2,133 with 20% down.

Positive: Mortgage rates eased for the second consecutive week and remain below the historical average of 7.74%. Negative: Mortgage rates are still above 7% for the fifth week in a row, and higher rates are hurting first-time buyers, causing a lock-in effect on homeowners, and eroding affordability.

Regardless of one’s personal outlook—yesterday's CPI report showed a small decline in inflation and moved closer to the Fed’s 2% target. The stock market reacted favorably, and ultimately, the news should continue to improve mortgage rates for late spring home buyers.