Mortgage Rates and Housing Affordability - August 2025

🏦 Mortgage Rates & Housing Affordability – August 2025 Update 📊 Current Mortgage Rate Environment

• 30-Year Fixed: Still hovering around 6.6–6.7%, showing little relief despite market hopes for Fed cuts.

• 15-Year Fixed: Averaging 5.9–6.1%, but affordability pressures remain.

• 5/1 ARMs: Sitting near 6%, offering only marginal savings.

For context, pre-pandemic 30-year fixed mortgages were in the 3–4% range. Today’s rates translate to ~$1,200 higher monthly payments on the median U.S. home.

• Affordability Crunch: Buyers are priced out in many metros, especially in the South and West. Demand remains weak, with mortgage applications down double digits YoY.

• Seller Concessions: Many sellers and builders are covering closing costs or offering rate buydowns to move inventory.

• Regional Variance: Midwest markets (Cleveland, Detroit, Louisville) are proving more resilient due to lower price points, while overheated markets like Austin, Phoenix, and Miami continue to cool.

• Fed Watch: Economists expect rate cuts to begin in Q4 2025, but most forecasts suggest mortgage rates will stay elevated above 6% through year-end.

• Market Sensitivity: Any dovish Fed shift or bond market rally could quickly pull 30-year rates back toward the 6% handle.

• Homebuilder Advantage: Builders with financing arms offering temporary rate buydowns may outcompete existing home sellers until true rate relief arrives.

• Are you seeing more rate buydown offers in your market?

• Do you expect mortgage rates to fall meaningfully this year, or will 6%+ remain the “new normal”?

• How do elevated financing costs change your view on Opendoor’s near-term opportunities?