Freddie Mac says rates haven't been this low since September 2022, stirring hopes of a better spring housing market
Mortgage rates dipped below 6% for the first time in three and a half years, offering a rare dose of relief to rate‑weary borrowers and rekindling hopes for a stronger spring homebuying season.
The average 30‑year fixed mortgage rate fell to 5.98% for the week ending Feb. 26. That's down from 6.01% a week earlier and well below the 6.76% level recorded a year ago, according to Freddie Mac.
The 15‑year fixed rate averaged 5.44%, slightly higher than 5.35% the previous week but also down from 5.94% a year earlier.
Freddie Mac chief economist Sam Khater framed the move as both symbolic and practical for buyers who have grown accustomed to rates hovering near or above 7%.
“For the first time in three and a half years, the 30‑year fixed-rate mortgage dropped into the 5% range, falling even lower than last week's milestone,” Khater said.
“This rate, combined with the improving availability of homes for sale, is meaningful and will drive more potential buyers into the market for spring homebuying season."
Just last week, mortgage rates tracked Treasury yields lower. The move was enough to spur a 5% jump in conventional refinance applications and a 26% surge in VA refinances, according to Mortgage Bankers Association (MBA).
The recent slide in borrowing costs closely tracked a drop in the 10‑year Treasury yield, after a US Supreme Court ruling narrowed the administration’s emergency tariff powers and unsettled financial markets.
For lenders, the sub‑6% print arrived at a delicate moment. Purchase activity historically responded to even modest rate moves, but tight inventory and economic uncertainty often muted that effect.
Originators previously warned that rate relief alone would not fully unlock demand without more sellers returning to the market and buyers gaining confidence in job and income prospects.
Still, the latest move offers a clearer narrative heading into the key spring months: volatility‑driven rate declines pushed mortgages into the high‑5% range, opening a window of opportunity for well‑qualified borrowers and giving lenders a chance to re‑engage sidelined clients who balked at 7%‑plus quotes last year.
Real estate giant Redfin reported that roughly 40,000 home-sale agreements were canceled, equal to 13.7% of January contracts, the highest share for that month since it began tracking the data in 2017.
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