Potential homebuyers already grappling with affordability challenges saw mortgage rates spike this week to levels not seen since spring of last year. The daily 30-year fixed-rate mortgage (FRM) clocked in at 6.91% on Sept. 2, the highest since 6.92% on May 26, 2025.
Real estate technology companies Zillow and Redfin have crucial comments on the impact of mortgage rates on rental behavior and homebuying trends that we will cover below, but first, let’s get into the current mortgage rate data.
“While the daily index rose into the 6.9’s today for the first time in more than year, many borrowers are already seeing rates at 7% or higher,” wrote Mortgage News Daily (MND).
The weekly mortgage rate reflected the uptick, but Freddie Mac noted a silver lining.
“The 30-year fixed-rate mortgage averaged 6.71% this week,” said Sam Khater, Freddie Mac’s chief economist. “Purchase demand has remained relatively stable indicating steady interest from buyers adapting to evolving market conditions.”
The average daily rate, MND explained, is an ideal scenario that doesn’t necessarily indicate the reality homebuyers face.
“When we reference average, daily, top-tier 30-year fixed rates, it is for an ideal scenario that rarely exists in the wild,” MND wrote. “The average scenario will always involve slightly higher effective rates (i.e. even if the rate is the same as national averages, it would involve additional upfront costs).”
“As a reminder, our daily rate index accounts for upfront costs whereas Freddie Mac’s weekly survey rate does not.”
Beyond mortgage rates, Zillow reports interest in renting
High mortgage rates can be a major factor in spurring interest in rentals — and Zillow says there are key things people consider.
“Renting is often how people try out a new community before committing,” said Mischa Fisher, chief economist at Zillow. “When we see a market with a growing share of rental searches coming from outside the metro, that tips us off to a developing pipeline.”
More on housing market:
- Zillow sees change in housing market, home values
- New home-selling strategy poses threat to buyers
- Goldman Sachs issues major prediction for U.S. housing market
Zillow points to specific cities to which people are looking to move.
“Prospective renters are looking beyond their own backyards, and new Zillow data reveals where they’re setting their sights,” Zillow wrote.
“An analysis of rental listing page views found that out-of-town interest is growing fastest in Buffalo, Chicago and Houston. The share of searches coming from renters outside these markets has surged over the past year — an early signal of where relocation demand may be heading next.”
Shutterstock
Redfin sees homebuyers gaining power anyway
Mortgage rates and high housing costs are the biggest challenge for prospective buyers, but there are positive signs for homebuyers.
“The typical U.S. home-sale price rose 2.2% year over year, while the average weekly mortgage rate was 6.66%, near its highest level in the last year,” real estate technology company Redfin wrote.
In a seasonally adjusted basis, newly listed U.S. homes for sale grew 2.1% week-over-week, hitting a four-year high, according to Redfin.
“The total number of homes for sale ticked up 0.4% week over week,” Redfin wrote. “That’s welcome news for house hunters, who have increasingly more options and negotiating power.”
Pending home sales remained virtually unchanged (-0.1%) week-over-week, hovering at their lowest point since February.
“The disconnect between growing listings and sluggish sales is exacerbating the buyer’s market we’re seeing in most of the country,” Redfin wrote.
Daily mortgage rates drop slightly
On Sept 3, the average daily 30-year fixed-rate mortgage dropped slightly to 6.88% from the Sept. 2 average of 6.91%, according to Mortage News Daily.
“Mortgage rates finally had a decent day on Thursday after spending the previous three days inching into the highest levels in more than a year,” MND wrote. “Part of the improvement was due to comments from Fed Governor Chris Waller, who said that it wouldn’t be necessary to hike rates at the next meeting unless inflation data surprises to the upside.”
“Before that, the underlying bond market was already showing some resilience in overnight trading,” MND continued.
“The prevailing pattern has been a fairly reliable correlation between bond yields and oil prices. But this time around, yields held fairly steady in the overnight session even though oil prices moved higher.”
Related: Zillow predicts major mortgage rate, housing market change
