Mortgage Rates Experience Largest Decline in a Year
After what felt like an eternity, mortgage rates finally moved — and last week, they dropped significantly.
On Friday, September 5th, the average 30-year fixed mortgage rate dropped to its lowest point since October 2024, marking the largest single-day decline in more than a year.
What Caused the Drop?
Mortgage News Daily reports that the drop came in response to the August jobs report, which showed weaker-than-expected results for the second consecutive month. This sent ripples through the financial markets, ultimately leading to lower mortgage rates.
Essentially, signs point to a slowing economy, and as confidence in this trend grows, the markets are adjusting in anticipation. Historically, this tends to push mortgage rates lower.
Why Now Is a Key Time for Buyers
This isn’t just a single headline or one report — it’s about what the rate drop could mean for you.
This recent drop can save you money on your next home purchase. The chart below illustrates how a monthly mortgage payment (principal and interest) compares at 7%—where rates were in May—versus the current rates.
Compared to just four months ago, your monthly payment could be nearly $200 lower—adding up to almost $2,400 in savings over the year.
How Long Could This Trend Continue?
It largely depends on how the economy and inflation move from here. Rates could fall further or rise modestly.
Be sure to work with a Benson & Mangold agent and trusted lender. They’ll monitor inflation trends, job market updates, and upcoming Fed actions to help you understand where mortgage rates might head next.
For now, here’s the takeaway: While the future of rates isn’t certain, breaking free from their months-long stagnation is positive news. If you’ve been feeling stuck, this could signal the start of a new opportunity. As Diana Olick, Senior Real Estate and Climate Correspondent at CNBC, notes:
“Rates are finally breaking out of the high 6% range, where they’ve been stuck for months.”
And that gives you more reason for optimism than you’ve had in a long time.
In Summary
This is the opportunity you’ve been waiting for.
Mortgage rates have just experienced their largest drop in over a year. If they hold near this level, a home that felt out of reach just a few months ago could become attainable.
Curious how today’s rates could lower your monthly payment? Connect with an experienced agent to find out.
