Weekly Mortgage Update 3/10/25

Mortgage rates are showing signs of relief as we head into the spring homebuying season. After peaking near 7% in January, the average 30-year fixed rate has eased to the mid-to-high 6% range in early March, driven by declining 10-year Treasury yields (down over 60 basis points from January highs) and shifting economic signals. Consumer sentiment is wavering amid mass layoffs in the federal sector and tariff uncertainties, but this has sparked a surge in refinance activity—the fastest pace in months—offering opportunities for brokers to engage clients looking to capitalize on lower rates.

Purchase demand is picking up modestly, with the Mortgage Bankers Association (MBA) noting a slight uptick in applications year-over-year, supported by growing inventory in key markets like Texas and Florida. However, affordability remains a hurdle, with home prices still elevated (up 15% since 2022 per the S&P CoreLogic Case-Shiller Index) and no significant national price drops expected in 2025. Experts forecast rates to hover between 6.5% and 7% through mid-year, potentially dipping below 6.5% by late 2025 if Federal Reserve cuts resume, though the next FOMC meeting (March 18-19) is unlikely to bring immediate changes.

For brokers, the focus is on adaptability: highlight rate-lock options for hesitant buyers, tap into refinance demand, and leverage increased for-sale inventory to fuel purchase activity. With economic volatility lingering—think tariffs and a softening job market—staying proactive and informed will be key to guiding clients through this unpredictable landscape.