Overview
- Freddie Mac reported the average 30‑year fixed mortgage rate fell to 6.48% on June 4, a small retreat from late‑May highs but still above rates seen earlier in 2026.
- The Mortgage Bankers Association said total application volume dropped 2.5% for the week ending May 29, with purchase applications down 3% to their slowest weekly pace since April.
- Adjustable‑rate activity weakened sharply as the MBA’s ARM index fell about 12% and ARM share fell to 8.5%, while the refinance index edged down 2% even as refi share rose to 38% of applications year over year.
- Economists and lenders point to the Iran conflict, higher oil prices, rising 10‑year Treasury yields and wider mortgage‑backed‑securities spreads as the main forces keeping long‑term borrowing costs elevated.
- Borrowers remain cautious: sellers hold low pandemic rates and many buyers are delaying moves, affordability has only marginally improved as income growth edges out price growth, and most analysts expect rates to trade in the mid‑6% range unless inflation, employment data, or Fed guidance produce a clear shift.