Mortgage Rates Hold Steady as 10-yr Treasury Yields Stabilize

What happened to mortgage rates this week?

The Freddie Mac 30-year mortgage rate  held steady at 7.4% this week as the 10-year Treasury yield stabilized around 5.2%. September’s CPI came in slightly hotter than expected, and of rising concern is the uptick in core CPI, which suggests that price pressures may be broadening beyond energy into other categories. Looking ahead, the acceleration in core CPI, a sign of sticky inflation, reinforces the case for another rate hike by December and could set the stage for additional hikes in early 2027. In other words, mortgage rates are unlikely to ease anytime soon, but bringing inflation under control would pave the way for lower rates and a much-needed boost to affordability for the year ahead. 

What does this mean for the housing market?

With mortgage rates holding above 7%, many prospective buyers have pulled back, and Realtor.com pending home sales dropped substantially in September as elevated rates continue to weigh on demand. Yet sitting on the sidelines isn’t the only option. Buyers who stay engaged may find footing in a market where motivated sellers are increasingly willing to negotiate. The share of price cuts hit a four-year high in September, and the share of listings pulled from the market remained in line with a year ago, suggesting sellers are committed to transacting. For home buyers, it is important to rate-proof their budget and ensure they are financially positioned to act when the right opportunity arises.