By WASHINGTON (Reuters) – U.S. mortgage rates edged down to a two-year low this week, which could provide a further boost to refinancing activity, though many potential home buyers remain on the sidelines.
The average rate on the popular 30-year fixed-rate mortgage dipped to 6.08% from 6.09% last week, the lowest level since September 2022, mortgage finance agency Freddie Mac said on Thursday. It averaged 7.31% during the same period a year ago.
“Given the downward trajectory of rates, refinance activity continues to pick up, creating opportunities for many homeowners to trim their monthly mortgage payment,” said Sam Khater, Freddie Mac’s chief economist.
“Meanwhile, many looking to purchase a home are playing the waiting game to see if rates decrease further as additional economic data is released over the next several weeks.”
The Federal Reserve last week cut interest rates by 50 basis points to the 4.75%-5.00% range, the first reduction in borrowing costs since 2020. The U.S. central bank raised its policy rate by 525 basis points in 2022 and 2023.