In this articlePHMLENDHIITB your favorite stocksCREATE FREE ACCOUNTwatch now2:4802:48Mortgage rates drop on jobs reportThe ExchangeThe average rate on the 30-year fixed mortgage dropped 16 basis points to 6.29% on Friday, according to Mortgage News Daily, ing the release of a weaker-than-expected August employment report.It marks the lowest rate since Oct.
3 and the biggest one-day drop since August 2024.
Rates are finally out of the high 6% range, where they've been stuck for months."This was a pretty straightforward reaction to a hotly anticipated jobs report," said Mortgage News Daily Chief Operating Officer Matt Graham.
"It's a good reminder that the market gets to decide what matters in terms of economic data, and the bond market has a voting record that suggests the jobs report is always the biggest potential source of volatility for rates."Graham said in a post on X that many lenders are "priced better" than Oct.
3 and would be quoting in the high 5% range.The drop is a major change from May, when the rate on the 30-year fixed peaked at 7.08%.
It's big for buyers out shopping for a today, especially given high prices.Take, for example, someone purchasing a $450,000 , which is just above August's national median price, using a 30-year fixed mortgage with a 20% down payment.
Not including taxes or insurance, the monthly payment at 7% would be $2,395.
At 6.29%, that payment would be $2,226, a difference of $169 per month.A sign is posted in front of a for sale on Aug.27, 2025 in San Francisco, California.
Justin Sullivan | Getty ImagesThat might not sound a lot to some, but it can mean the difference in not just affording a , but qualifying for a mortgage.builder stocks reacted favorably Friday, with names Lennar, DR Horton and Pulte all up roughly 3% midday.
building ETF ITB has been running hot for the last month as rates slowly moved lower.
It's up close to 13% in the past month.Get perty Play directly to your inboxCNBC's perty Play with Diana Olick covers new and evolving opportunities for the real estate investor, dered weekly to your inbox.
here to get access today.The big question is whether the drop in rates will be enough to get buyers back in the market.Mortgage demand from buyers, an early indicator, has yet to respond to gradually imving rates.
Applications for a mortgage to purchase a last week were 6.6% lower from four weeks before, according to the Mortgage Bankers Association."buyers grapple with a lack of affordability, sellers contend with more competition, and builders deal with lower buyer demand," said Danielle Hale, chief economist at Realtor.com, in a statement Friday after the release of the August employment report.
"These conditions haven't spelled catastrophe, but have created a cruel summer for the housing market."Some analysts have argued that buyers need to see mortgage rates in the 5% range before it really makes a difference.
prices remain stubbornly high, and while the gains have definitely cooled, they are not yet coming down on a national level.
In addition, uncertainty the state of the economy and the job market has left many would-be buyers on the sidelines.Don’t miss these insights from CNBC Nobel winner Joseph Stiglitz has a warning for bond investorsAs traditional 60/40 portfolios get riskier, BlackRock says investors should rethink their allocationsGoldman adds Walmart to September 'conviction list.' Here's who else made the cutNvidia retail buyers are getting exhausted