Mortgage rates slipped below 6.3% for the first time in more than a month, giving homebuyers a rare bit of relief this spring. The average rate on a 30-year mortgage was 6.23% through Wednesday, down from 6.3% a week earlier.
The decline mattered immediately. Mortgage applications for home purchases surged 10% last week, while refinancing applications rose 6%, a sign that borrowers moved quickly when rates eased.
Sam Khater, chief economist at Freddie Mac, said rates currently stand at their lowest level in the last three spring homebuying seasons. That fits a broader stretch of modest improvement in the housing market, with new listings up 3% for the four weeks through April 19 and monthly pending home sales also picking up.
The drop in borrowing costs came as market optimism grew around ongoing negotiations between the United States and Iran, helping pull rates lower after weeks of steadier footing. For now, the move below 6.3% does not make mortgage financing cheap, but it does reopen the market for buyers who had been sitting out and gives existing homeowners another reason to watch rates closely.
The next test is whether the latest easing holds long enough to keep purchase demand moving into the heart of the spring selling season.
