Mortgage Interest Rates

The 30-year fixed-rate mortgage dropped to 6.20% during the week ending Sept. 13. Mortgage rates have now fallen to the lowest levels in the past 18 months. NAHB is forecasting sustained, sub-6% mortgage interest rates will occur in the second quarter of 2025. (NAHB previously forecast this would not occur until the fourth quarter of 2025.)

Inflation data continue to moderate, setting the stage for the Federal Reserve to cut interest rates. The question is whether it will be a 25- or a 50-basis-point reduction, given recent slowing in the labor market. The NAHB forecast has been revised for a 25-basis-point cut in September and one more before the end of 2024.

However, faced with record-high prices for homes, many would-be buyers continue to stay on the sidelines until housing affordability conditions improve further.