Today's Mortgage Rates - 03/13/2025

Mortgage Rates Mostly Flat

While the underlying yields that influence them have been volatile in recent days, mortgage rates remained pretty steady.

Freddie Mac reported today that the average offered interest rate for a conforming 30-year fixed-rate mortgage (FRM) rose by two basis points (0.02%) this week to perch at 6.65%. The modest increase broke a seven-week string of declines.

Average offered rates for 15-year fixed-rate mortgages also edged higher, but by the barest amount, increasing by just one basis points (0.01%) to 5.80%. This small increase didn't change the picture here much as the average rate for the most popular short-term mortgage remained roughly at levels last seen in October 2024.

A 5/1 ARM might offer a homebuyer a lower-cost alternative to a long-term fixed-rate mortgage, and the difference in rate between 30-year FRMs and 5-year hybrid ARMs expanded by just a little this week. The Mortgage Bankers Association said that the initial fixed interest rate on a hybrid 5-year ARM eased by four basis points (0.04%), dropping back to 5.81%. This widened the gap in rate compared to a 30-year FRM to eighty-four basis points (0.84%). A nearly seven-eighths of a percentage point differential in rate may be considerable enough to entice some late winter or early spring homebuyers to select an ARM as their choice of financing, as there will be some savings to be had by doing so.

Financial markets continue to struggle with messages coming out of Washington regarding the imposition of tariffs. Added to the uncertainty is concern that the economy is showing signs of slowing. Coupled together, these would tend to dent stocks and help lower bond yields. However, inflation is still not back at the Fed's target and the imposition of tariffs increases the prospect it will rise again as the year goes on. As such, there are limits as to how much yields can decline; hence, this week's plateau after a string of declines.

That's not to say that yields and rates cannot decline further. Equity markets continue to have a lack of traction amid uncertainty, and this could see some more funds pushed over into the bond side of the investment portfolio. At least to us, the chances of a fresh downside for yields seems somewhat limited at the moment, and there's a Fed meeting coming up next week, where an update and outlook from the central bank may (or may not) help steady things, too.

At the moment, the influential yield on the U.S. ten-year Treasury is back to about where it began the week, belying a significant decline seen early in the week. Over the next couple of days, mortgage rates seem likely to hang around present levels, give or take a little.

Each week in HSH's MarketTrends newsletter, we track and discuss economic conditions that affect mortgage rates and their impact on housing markets and consumers. Read the most recent edition of MarketTrends or subscribe for email delivery.