Mortgage Rates Tick Down to 6.85% as Spring Selling Season Approaches

Mortgage rates have dipped slightly again for the fifth straight week, bringing some modest relief to prospective homebuyers as spring approaches.

The average rate on 30-year fixed home loans dipped to 6.85% for the week ending Feb. 20, down only marginally from 6.87% the prior week, according to Freddie Mac. Rates averaged 6.9% a year ago.

“The 30-year fixed-rate mortgage has stayed just under 7% for five consecutive weeks, and in that time has fluctuated less than 20 basis points,” says Freddie Mac Chief Economist Sam Khater. “This stability continues to bode well for potential buyers and sellers as we approach the spring homebuying season.”

The spring selling season, when the housing market generally sees the greatest activity of the year, unofficially kicked off after Super Bowl weekend, when buyers and sellers start lining up agents.

Activity generally picks up in earnest in March, with many buyers and sellers aiming for a closing date around the end of the school year, to avoid disruptions for families with younger children.

Although affordability and elevated mortgage rates remain serious challenges for many buyers, relative stability for mortgage rates should allow for better planning and budgeting in the coming months.

Mortgage rates have remained little changed since the Federal Reserve paused its rate cuts last month, and barring unforeseen economic calamity, home loan rates are unlikely to move significantly in the near future.

“Stubborn inflation will likely continue to hinder mortgage rate progress,” says Realtor.com® senior economic research analyst Hannah Jones. “As a result, hopeful homeowners are at an all-too-familiar crossroads and must decide whether to continue renting or to take the plunge into the housing market.”

Prices remain cool as spring approaches

The Realtor.com economic research team’s weekly housing market update shows that for the week ending Feb. 15, the median list price of homes on the market was down 0.5% from the same week last year.

It marked the 38th week in a row in which the national median home list price was either flat or declining on an annual basis, a stretch dating to June 2024.

For buyers eyeing a purchase in the spring selling season, the slowdown in price growth will come as welcome relief, helping to offset higher mortgage rates.

“Though prices and mortgage rates are still significantly higher than they were five years ago, the cooling of the market means that buyers can take their time to find the right home for their needs, possibly even one with a reduced price,” says Realtor.com senior economist Joel Berner.

New listings and active inventory continue to rise

The number of new homes hitting the market last week jumped 5% from the same week a year ago, in another buyer-friendly trend.

Active inventory also continued to rise, and the total number of homes on the market was up 27.6% from year-ago levels.

It marked the 67th consecutive week of rising inventory and the sixth straight week of a rising number of new listings.

The trend should help alleviate the supply shortage that has been a longstanding pain point for buyers, who have faced a market plagued by a scarcity of options for the past several years.

“Buyers can expect more options to choose from in 2025 as we enter the start of the homebuying season,” says Berner.

Time on the market still growing

Homes are staying longer on the market than they did a year ago, with the typical home remaining on the market six days longer for the week ending Feb. 15.

Rising time on the market is another buyer-friendly signal, giving home shoppers a better chance to weigh their options and craft a strong offer, with less chance of being pressured to compete with other bids.

“This is all good news for buyers, who had been feeling the effects of the post-pandemic pinch in for-sale listings for several years until the market entered its current rebalancing phase,” says Berner.