Mortgage Rates Hit Six-Month High: Freddie Mac

Weary observers of th housing market hoping to celebrate the start of a new year with lower mortgage rates received a rude welcome to 2025.

In the first full week of the year, the average 30-year fixed-rate mortgage rate was 6.93 percent, according to a report from Freddie Mac, marking the highest level since July.

Freddie Mac chief economist Sam Khater in a statement cited the broader strength of the economy for the upward pressure on mortgage rates. Inflation remains stubbornly high and the Federal Reserve already looks poised to cut interest rates fewer times than initially expected this year; that’s only tangentially tied to mortgage rates, which track more closely to 10-year Treasury bonds than interest rates.

The 30-year fixed mortgage rate average barely jumped from the previous week, but was up from 6.66 percent a year ago. The 15-year fixed rate, meanwhile, averaged 6.14 percent, up from 5.87 percent a year earlier.

Expectations for mortgage rates aren’t getting any rosier for prospective buyers, who may need to cut their expectations about cut mortgage rates and take what they can get.

A recent forecast by Jonathan Lansner of the Orange County Register predicted average mortgage rates to range between 6.15 percent and 7.55 percent this year. The projection was based on 52 years of Freddie Mac data.

The big unknown is how President-elect Donald Trump’s policies may affect mortgage rates with his agenda returning to the White House this month.

Economists raised forecasts on mortgage rates in the near future in the wake of Trump’s election victory in November. The incoming president’s proposals have included significant tariff and tax cuts.

Economists expect the costs of tariffs to be passed on to consumers, potentially increasing inflation. Tax cuts, meanwhile, could lower fiscal revenue and raise the national debt, leading to higher long-term interest rates.