Is the surge in mortgage rates slowing?

SALT LAKE CITY — Mortgage rates slid slightly downward Thursday.

The weekly average mortgage rate in the U.S. dipped to 7.32% Thursday for a 30-year, fixed-rate loan, according to the Federal Home Loan Mortgage Corporation, better known as Freddie Mac.

The decline from 7.4%, an average rate that's held over the past two weeks after climbing steadily since August, was described on the Freddie Mac site as "offering some relief to prospective homebuyers."

The daily rate tracker at Mortgage News Daily also dropped the average rate for the same type of mortgage Thursday from 7.4% to 7.32%. "Don't Overthink It," read the headline on the site's post about a sharp fall in the long-term government bond yield that's tied to mortgage rates.

Whether the shift in direction for mortgage rates continues remains to be seen. A Homes.com post Thursday was not optimistic, noting that even though rates have eased, "they're still above 7%, and economists say more increases might be on the horizon."

Homes.com cited the recently revised housing forecast by the Federal National Mortgage Association, known as Fannie Mae, that now anticipates an average mortgage rate of 7.4% through the end of the year, rising to 7.5% for 2027.

That's a jump from Fannie Mae's September prediction of a 6.8% average mortgage rate for the rest of 2026, slipping to 6.7% next year. At the start of the year, rates were expected to stay closer to 6% but have been heading up since the February launch of the war against Iran.

The surge in mortgage rates to 7.4% just over the past month "wiped out $22,000 in home purchasing power" for a buyer who budgeted $2,000 a month to pay principal and interest on a home loan, according to Realtor.com.

Even with the current dip in mortgage rates, homebuyers are facing higher costs. Home prices went up 0.25% in September, according to the online real estate brokerage Redfin. Prices are 3.8% higher than in August 2025, growing at the fastest annual rate since June 2025.

In Utah, the median sales price for a home reached $530,000 in September, a 1.9% increase over the $520,000 the typical buyer in the state paid in the same month last year, Utah Association of Realtors spokeswoman Deanna Devey said.

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