US mortgage interest rates have been falling for two weeks, and it is still difficult to save the market. Housing sales prices have fallen for the first time in more than three years

The Zhitong Finance App learned that US mortgage interest rates fell for the second week in a row, but remained high at 7% or more, failing to effectively boost the housing market, which continues to be sluggish. The high cost of buying a home is forcing potential buyers to delay their plans, and at the same time, more and more sellers are lowering listing prices. According to the latest data, housing sales prices in the US fell for the first time in more than three years, and the imbalance between supply and demand in the housing market worsened further.

According to data released by Freddie Mac on Thursday, the average interest rate for a 30-year fixed mortgage in the US fell to 7.24% from 7.32% the previous week, falling for the second week in a row, but still close to the highest level since November 2023. In comparison, the mortgage rate for the same period last year was only 6.17%.

Notably, interest rates on 30-year US mortgages have remained above 7% for six consecutive weeks, the longest since the end of 2023. Although interest rates have declined from the three-year high of 7.4% hit in mid-October, they are still more than 1 percentage point higher than at the beginning of the year, causing the affordability of buyers to continue to deteriorate.

High interest rates continue to curb demand for home purchases, and monthly mortgage payments have increased significantly

The US housing market is in a dilemma where high housing prices are compounded by high interest rates. On the one hand, mortgage interest rates continue to be high, making it difficult for many potential buyers to bear the cost of buying a home; on the other hand, owners who already have low interest rate mortgages are unwilling to sell their existing homes to avoid bearing higher financing costs after changing homes, further limiting the supply of housing in the market.

According to relevant estimates, taking the purchase of a home worth 500,000 US dollars as an example, assuming a down payment ratio of 20%, the current monthly mortgage principal and interest expenses have increased by about 333 US dollars compared to the end of February this year. At the time, interest rates on US mortgages had briefly fallen below 6%.

If a home worth $1 million was purchased, the monthly mortgage expenditure would increase by about $666 compared to the end of February at the same down payment ratio.

According to data from real estate agency Redfin, the median monthly mortgage payments of US homebuyers are currently hovering near the highest level in history. Mike Fratantoni, chief economist at the American Mortgage Bankers Association (MBA), said that it is probably unlikely that US mortgage interest rates will drop significantly for some time to come. “We do not expect significant relief in mortgage interest rates during the forecast period.”

He pointed out that mortgage interest rates, which are currently around a three-year high, are causing housing sales, mortgage issuance, and commercial real estate market activity to slow down markedly.

Meanwhile, the Federal Reserve decided to keep interest rates unchanged at the October monetary policy meeting, and the market still expects it to raise interest rates further at the last meeting of this year. This also means that it may be difficult for the US housing market to obtain clear interest rate support in the short term.

US housing prices fell for the first time in more than three years, and the number of sellers far surpassed that of buyers

As housing affordability continues to deteriorate, the US real estate market is showing increasingly clear signs of falling prices.

According to data released by Redfin on Thursday, the median home sales price in the US fell for the first time in more than three years, reflecting that high home purchase costs are weakening sellers' pricing power. At the same time, the relationship between supply and demand in the housing market has also changed markedly. According to Redfin data, in September of this year, the number of sellers in the US housing market surpassed buyers by nearly 63%, the biggest gap since relevant statistics were available in 2013.

This data shows that although some existing homeowners are still unwilling to sell their homes, the number of people willing to buy a home in the market is falling faster, allowing buyers to gradually gain more initiative in price negotiations.

Redfin senior economist Asad Khan said that the current US housing market has a contradiction worth paying attention to: from the perspective of housing supply, buyers are facing one of the most favorable market environments in many years, yet the high cost of buying a home makes it impossible for many people to take advantage of this opportunity. “Ironically, from a supply perspective, this is probably one of the most favorable market environments for buyers in years.” Khan said, “But this situation comes at a time when the cost of buying a home is so high and fewer and fewer people can afford it.”

New home sales continue to weaken, builders' confidence falls to a 14-year low

High mortgage interest rates are not only impacting the second-hand housing market, but are also dragging down new home sales in the US. According to data released by the US Census Bureau on Tuesday, sales of newly built single-family homes fell 0.6% month-on-month in September, indicating continued weakness in demand for home purchases.

New home prices are also facing downward pressure. The data shows that in the nine-month data released so far in 2026, the median sales price of new homes in the US has been declining for seven months. Facing weak sales, more and more homebuilders are having to attract buyers through price cuts and other preferential measures, but this has further squeezed corporate profit margins.

According to the housing market index compiled jointly by the National Association of Home Builders (NAHB) and Wells Fargo Bank, US homebuilders' confidence has fallen to its lowest level in 14 years due to factors such as high mortgage interest rates, continued labor shortages, and rising construction material costs.

The difficulties faced by builders also reflect that the weakness in the US housing market is not simply caused by a shortage of housing, but that high financing costs continue to suppress market activity from the demand side.

The short-term recovery of the property market still faces challenges

Overall, although US mortgage interest rates have declined slightly for two consecutive weeks, financing costs of 7% or more are still putting significant pressure on the housing market.

For potential buyers, high housing prices combined with high interest rates keep the monthly mortgage burden close to historic highs; for sellers, a decrease in the number of buyers means that the home sales cycle may be extended, and the pressure to reduce prices will increase accordingly. Furthermore, the slowdown in new home sales, the decline in builder confidence to a 14-year low, and the number of sellers in the second-hand housing market significantly surpassing buyers all indicate that the US housing market still lacks momentum for continued recovery.

Against the backdrop that the Federal Reserve may raise interest rates further in the short term and mortgage interest rates are difficult to drop significantly, the US housing market may continue to face the double pressure of weak demand and price adjustments.