MW Bad news for home buyers: Mortgage rates remain stuck near 7%

By Aarthi Swaminathan

Rates aren't moving up or down much but that offers more stability for home buyers, mortgage industry says

Home buyers continue to face steep borrowing costs as the spring home buying season approaches, with mortgage rates remaining largely frozen over the last four weeks.

The 30-year fixed-rate mortgage averaged 6.65% as of March 27, according to a weekly report from Freddie Mac (FMCC). The 30-year is down 2 basis points from a week ago.

But rates are double what they were five years ago. In late March 2020, the 30-year fixed-rate mortgage averaged 3.5%.

Some in the mortgage industry said that the fact that rates were largely unchanged offered stability to buyers. "For home buyers, particularly first-time buyers, a more stable rate environment allows for better planning and budgeting," Samir Dedhia, chief executive of One Real Mortgage, said in a statement.

Realtors, on the other hand, are calling for a "meaningful" drop in rates to boost home sales. Pending-home sales, which offer an early read of existing-home sales in the coming months, rose slightly 2% in February but remained below normal historical levels, the National Association of Realtors said.

Read more: Home-buying demand looks wobbly ahead of key season for the housing market

"Recent mortgage rates in the high-6% and low-7% range have proven to slow home sales relative to last year, so seeing them remain in this range this week will spell more bad news in the housing market," Joel Berner, a senior economist at Realtor.com, said in a statement.

One real-estate agent said that home buyers were also worried about their personal financial circumstances, suggesting that home-buying demand could be weak in the months ahead.

"Buyers are cautious because they're worried about the economy and potential layoffs, and they're wondering if mortgage rates will come down later this year," Kimberly Freutel, a Sammamish, Wash.-based real-estate agent with Redfin, said. Redfin $(RDFN)$ is a real-estate brokerage.

The median sale price of a home as of Mar. 23 was $383,750, according to Redfin.

Lennar $(LEN)$, a major home builder in the U.S., also said that job security has become a concern holding some buyers back from purchasing newly built homes.

Read more: Home prices are falling, but job security has become a new concern, Lennar says

In this current environment of high rates and high home prices, "home affordability is seriously constrained and the dream of homeownership feels out of reach to over [one] million Americans who are not striking out on their own because they cannot afford a mortgage payment on a house that meets their needs," Realtor.com's Berner said.

(Realtor.com is operated by News Corp subsidiary Move Inc.; MarketWatch publisher Dow Jones is also a subsidiary of News Corp.)

-Aarthi Swaminathan

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March 27, 2025 12:16 ET (16:16 GMT)

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