The average rate on 30‑year mortgage loans in the US exceeded 7% in October, slowing activity in the housing market, according to Freddie Mac.
Rate levels and monthly payments
The average rate on 30‑year mortgages was 6.86% in September and exceeded 7% in October, averaging 7.4% last week. That is equivalent to approximately 2,077 US dollars per month for a 30‑year mortgage on a US$300,000 home, compared with about 1,851 dollars per month a year ago at a rate of 6.27%.
Existing-home sales and the expectations index
The pending home sales index, published by the National Association of Realtors (NAR), fell 7.3% in September compared with August and 11.3% year on year. The index reading of 66 in September is the lowest since the series began in 2001.
The report on existing-home sales, based on completed transactions, showed a slight increase of 1.5% in September compared with August, but the pace over the past two months was the weakest since 2016.
New-home construction and economists’ views
The seasonally adjusted annual rate of new-home construction in September was 1.22 million units, down 5.2% from August and 7.4% year on year. Building permits in September recorded an annual rate of 1.4 million, 0.2% lower than in August and 3% below the September 2025 level.
“Market conditions weakened in September due to the rapid rise in mortgage rates,” said Lawrence Yun, chief economist at the National Association of Realtors (NAR). Matthew Martin, senior economist at Oxford Economics, noted: “The recent rise in mortgage rates, combined with our expectation that they will stay higher for longer, is another hit to housing affordability,” adding that higher rates “will weigh on sales and slow construction.”
The effective cost of a mortgage takes into account not only the interest rate but also fees, insurance and prepayment terms.
Demand and housing formats
Reports indicate increased demand for housing in regional areas among families and buyers who previously targeted major cities. This reflects a shift in buyer priorities, with no detail in the source about specific housing types or states.
