Last week, the 30-year fixed-rate mortgage fell to its lowest point in 15 months, marking the most significant one-week decline this year. This drop in mortgage rates, combined with a recent rise in local real estate listings, offers a great opportunity for prospective home buyers, as their options and purchasing power have significantly increased.

On August 8th, mortgage buyer Freddie Mac reported that the 30-year fixed-rate mortgage had decreased to 6.47%, down from 6.73% the previous week, marking the second consecutive weekly drop. The interest rate for 15-year fixed-rate mortgages also declined, from 6.34% a year ago to 5.63% earlier this month, encouraging homeowners to consider refinancing. Reflecting this trend, the Mortgage Bankers Association’s refinance index showed a nearly 60% increase in refinance applications compared to the same week in 2023.

High mortgage rates have deterred home shoppers nationwide, contributing to a housing slowdown that is now in its third year. The average rate for a 30-year mortgage has recently hovered around 7%, more than double the average rate seen in 2021. The recent decline in rates indicates easing inflation and a cooling job market. If these trends continue, we can anticipate an increase in refinance applications and higher volumes of refinancing. Additionally, if mortgage rates keep falling, more homes and condos in the Seattle area may change hands in the coming months.