US mortgage rates drop below 6% for the first time since 2022

U.S. mortgage rates drop to lowest level since 2022

U.S. mortgage rates fell below 6% this week, marking their lowest level since late 2022 and providing a boost to homebuyers as the spring selling season begins.

The average 30-year fixed-rate mortgage dropped to 5.98% as of Thursday, according to Freddie Mac. That is down from 6.01% last week and significantly lower than the 6.76% recorded a year ago.

This marks the third consecutive weekly decline and the lowest rate recorded since Sept. 8, 2022.

Rates previously soared above 7% in 2023 as the Federal Reserve raised interest rates to combat inflation. They have trended downward for several months, fueled in part by the Fed’s rate cuts last fall.

The Trump administration is also intervening to address housing affordability. Last month, the president directed the federal government to purchase $200 billion in mortgage bonds to drive rates down.

The White House is also pushing for a ban on institutional investors purchasing single-family homes. Officials hope the move will reduce competition for individual buyers.

While existing home sales hit a 30-year low last year, economists expect these new rates to encourage more buyers to enter the market.

Structural Deadlock Persists in U.S. Housing Despite Softening Mortgage Rates

While mortgage rates dipping below the 6% threshold marks a critical psychological milestone, it remains a superficial fix for the deep-seated structural imbalances currently defining the U.S. housing market. The sector is caught between two diametrically opposed forces: aggressive policy intervention aimed at stimulating demand and a historic supply-side paralysis.

On the policy front, the Trump administration has signaled a more interventionist approach to market liquidity. The commitment to purchase $200 billion in mortgage-backed securities (MBS) represents a clear admission that Federal Reserve monetary policy alone is insufficient to stabilize the market. Furthermore, the proposal to restrict institutional investors from the residential market highlights a strategic pivot toward prioritizing individual homebuyers over corporate capital—an attempt to lower the barriers to entry in an increasingly exclusionary environment.

However, these demand-side catalysts are running headlong into the "lock-in effect," which remains the primary obstacle to a functional market. With nearly 69% of current homeowners holding fixed-rate mortgages at 5% or lower, there is virtually no financial incentive to list properties. Selling would require these owners to trade into a new mortgage at significantly higher rates, effectively freezing inventory. This supply drought continues to apply upward pressure on valuations, even as high borrowing costs dampen overall buyer enthusiasm.

Consequently, while lower rates may entice a marginal segment of new buyers, they fail to resolve the core deficit of available housing. Until the inventory backlog is meaningfully addressed, the market is likely to remain in a state of stagnation. While the upcoming spring home-buying season may see a modest uptick in activity compared to last year’s historic lows, a comprehensive recovery remains a distant prospect.

For many Vietnamese-American families, homeownership remains a cornerstone of the American Dream. With interest rates finally dipping below 6%, monthly mortgage payments could drop by several hundred dollars, making a purchase much more attainable for small business owners and families in cultural hubs like Little Saigon in Orange County or Houston. Whether you are a nail salon owner or a phở restaurant operator, these savings represent a significant shift in affordability.

However, the community still faces steep hurdles, including skyrocketing property values and limited inventory. A proposed ban on large corporations purchasing single-family homes—a policy discussed by the Trump administration—could provide direct relief to individual buyers. By curbing competition from institutional investors, Vietnamese families would have a fairer shot at securing a home without being outbid by Wall Street firms.

For Vietnamese homeowners who entered the market during the high-rate environment of 2023–2025, this downward trend presents a prime opportunity to refinance. Lowering those monthly payments can significantly ease the financial burden on the household, providing more breathing room for daily expenses or the ability to sustain remittances to loved ones abroad.