T
he 30‑year fixed mortgage slipped 16 basis points to 6.29 % on Friday, the lowest level since October 3 and the largest one‑day decline since August 2024, according to Mortgage News Daily. The fall follows an August employment report that came in weaker than analysts had expected, breaking the long‑standing high‑6 % plateau that has held for months.
“Rates moved as expected after the jobs data,” said Matt Graham, COO of Mortgage News Daily. “The bond market clearly signals that employment figures are the most volatile driver for rates.” Graham added on X that many lenders are now “priced better” than on October 3, with quotes hovering in the high‑5 % range.
The change is stark compared to May, when the 30‑year rate peaked at 7.08 %. For buyers, the difference is tangible. A $450,000 home—just above the August national median—requires a 20 % down payment. At 7 %, the monthly payment (excluding taxes and insurance) would be $2,395; at 6.29 %, it drops to $2,226, saving $169 each month. That margin can be the deciding factor between qualifying for a loan and being turned away.
Homebuilder shares reacted positively on Friday. Lennar, D.R. Horton, and Pulte each rose about 3 % by midday. The home‑building ETF ITB, which has been climbing steadily as rates ease, is up nearly 13 % over the past month.
Despite the rate drop, mortgage demand remains sluggish. The Mortgage Bankers Association reported a 6.6 % decline in new purchase‑loan applications compared with four weeks earlier. “Homebuyers are still struggling with affordability, sellers face stiffer competition, and builders see lower demand,” said Danielle Hale, chief economist at Realtor.com. “These conditions have created a cruel summer for the housing market, though they haven’t caused a collapse.”
Some analysts argue that only a move into the 5 % range will truly ignite buyer activity. Home prices stay stubbornly high, and while gains have cooled, they haven’t fallen nationwide. Economic uncertainty and job‑market volatility keep many prospective buyers on the sidelines.
Whether the recent rate decline will be enough to revive the market remains to be seen, but the 6.29 % level marks a significant shift from the high‑6 % era that dominated the past months.
