According to Freddie Mac’s latest Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 6.50 percent in the U.S. as of February 23, 2023.

“The economy continues to show strength, and interest rates are repricing to account for the stronger than expected growth, tight labor market and the threat of sticky inflation,” said Sam Khater, Freddie Mac’s Chief Economist. “Our research shows that rate dispersion increases as mortgage rates trend up. This means homebuyers can potentially save $600 to $1,200 annually by taking the time to shop among lenders to find a better rate.”

Freddie Mac News Facts

  • 30-year fixed-rate mortgage averaged 6.50 percent as of February 23, 2023, up from last week when it averaged 6.32 percent. A year ago at this time, the 30-year FRM averaged 3.89 percent.
  • 15-year fixed-rate mortgage averaged 5.76 percent, up from last week when it averaged 5.51 percent. A year ago at this time, the 15-year FRM averaged 3.14 percent.

Nadia Evangelou, NAR senior economist and director of real estate research said, “Mortgage rates increased further this week, following the bond market trend. According to Freddie Mac, the average rate on a 30-year fixed mortgage rose to 6.50% from 6.32% the previous week. Even with this increase, owning a home is still affordable for Americans if they can put 20% down. The monthly mortgage payment is $1,880 for a median-priced home. Despite higher mortgage rates, the homeownership rate rose in 2022.”

Evangelou further commented, “Even though many buyers were priced out due to historic low affordability, more Americans were able to become homeowners. There were about 1.6 million more homeowners in 2022 than the previous year. While many existing homeowners opt to stay put due to higher rates, some renters were able to purchase a home amid rising affordability challenges. Historically speaking, the homeownership rate continues to be below the pre-recession peak of 69.2% (in 2004) but is still above the historical average of 65.6%. With mortgage rates projected to stabilize below 6% in the second half of the year, more Americans will likely become homeowners, boosting the homeownership rate this year as well.”

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