Mortgage rates dropped slightly over this week by 0.06%, but still remain at a high 6.89%. The rate usually follows the 10-year Treasury yield. When President Trump made executive orders on tariffs, treasury yields became expected to drop causing mortgage rates to follow suit. However, rates did not drop to the same degree as yields due to the volatile nature of current policy developments and economic conditions. This unpredictable future is why mortgage rates are forecasted to remain high, and even increase throughout the year. As a result, applications to purchase a new home have fallen. This decrease in applications is likely to become a trend this year.
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It will be interesting to see if builders and investors lower home prices to recover some of their losses from the housing market slowdown.
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