Hi Reader,

The average 30-year fixed mortgage rate ended the week at 6.58%, unchanged from the prior week, according to Mortgage News Daily. Freddie Mac reported 6.47%, down from 6.52% the week before.

Freddie Mac’s number is a weekly average and can lag what is happening in real time, while Mortgage News Daily tends to reflect the day-to-day market more quickly.

Why rates remained in the same range

This week was a good reminder that mortgage rates do not move based on one headline. Oil prices, inflation expectations, Fed policy, Treasury yields, and global risk all interact. A push and pull of economic factors makes it hard to predict where rates will go.

Earlier in the week, Treasury yields moved lower after news of a potential U.S./ Iran peace deal. Oil prices fell sharply, with WTI crude down around 6%, which helped ease some inflation concerns. Since oil feeds into the cost of transportation, goods, and overall inflation expectations, lower oil prices can be helpful for mortgage rates.

But that relief did not last long.

By midweek, Treasury yields moved back up after the Fed kept rates unchanged but signaled a more hawkish tone. The market started pricing in the possibility that the Fed’s next move could actually be a rate hike, not a cut. The 2-year Treasury, which is especially sensitive to Fed expectations, jumped to its highest level since February.

The 10-year Treasury, which mortgage rates tend to follow, also moved higher after the Fed decision, rising to around 4.46%. Later in the week, it settled back slightly, but by today, yields were rising again, with the 10-year around 4.48%.

In a nutshell:

1. Oil prices falling helped.
2. Middle East tensions easing helped.
3. But the Fed sounding more concerned about inflation hurt.
4. And strong economic data is still keeping rates elevated.

That is why mortgage rates are not falling meaningfully, even when one piece of the puzzle - the potential U.S./Iran deal - looks better.

What does this mean for buyers?

For buyers, the salient point is that rates are still in the mid-6s, and the market is starting to adjust to that reality.

A lot of buyers spent the last few years waiting for rates to go back to the 3s, 4s, or 5s. But the longer rates stay above 6%, the more buyers start treating this as the new normal and adjusting their budgets accordingly.

That does not mean affordability is easy. It is not. But it does mean that buyers who have been sitting on the sidelines may be starting to re-engage, despite rates remaining in the 6s.

Real estate news

​Pending home sales rose 3.8% in May from the prior month and were up 4.8% from a year ago, according to NAR.

That is a meaningful signal because pending sales measure signed contracts, not closed sales. In other words, this is an early look at buyer activity.

NAR described it as a “late-spring buyer rush,” even with mortgage rates not really budging.

The Northeast stood out, with pending home sales up 8.7% month-over-month and 6.1% year-over-year. That is especially interesting because the Northeast has been one of the most inventory-constrained regions, with prices staying firm even as sales slowed.

Buyers' perspective: buyers are not necessarily waiting for perfect rates anymore. They are adjusting to the market in front of them.

What I’m seeing with clients

Lately, I’ve been working a lot with my favorite type of client: first-time home buyers.

I love setting them up for success before they start running around to open houses and making offers without a plan.

For my buyers, that usually means:

1. A thorough, fully underwritten pre-approval when possible.
2. A Zoom meeting to go over their goals and review everything so they are confident.
3. A realistic look at interest rate ranges and trends.
4. A clear understanding of monthly payment sweet spots.
5. Down payment and closing cost planning.
6. And most importantly, strategy.

Because the goal is not just, “Can this buyer qualify?”

The goal is:

• What price point actually feels comfortable?
• What type of property gives them the best shot?
• How do we make their offer stronger?
• Where do they have flexibility?
• And how do we help them avoid surprises once they are already in contract?

That is especially important right now. Buyers are dealing with higher rates, higher prices, and limited inventory in many markets. The buyers who are most prepared are the ones who can move quickly and confidently when the right property comes up.

So if you have a first-time buyer who is nervous, overwhelmed, or not sure where to start, I am always happy to help them understand the numbers and the strategy before they get too deep into the process.

Hope your week is off to a great start!

-Nicole

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Nicole Hamilton Bernheimer | NMLS #2354049

nicole@homeownering.com, 917-650-0167

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