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Mortgage rates today: Wednesday, March 22, 2023
On Wednesday, March 22, 2023, the average interest rate on a 30-year fixed-rate mortgage dropped four basis points to 6.741% APR. The average rate on a 15-year fixed-rate mortgage went up 15 basis points to 6.057% APR, and the average rate on a 5-year adjustable-rate mortgage rose four basis points to 6.903% APR, according to rates provided to NerdWallet by Zillow. The 30-year fixed-rate mortgage is six basis points higher than one week ago and 213 basis points higher than one year ago. A basis point is one one-hundredth of one percent. Rates are expressed as an annual percentage rate, or APR.
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Mortgage rates this week
Mortgage rates experienced an unexpected and substantial decrease in the week ending March 16 as markets attempted to deal with the fallout from high-profile bank failures.
The 30-year fixed-rate mortgage averaged 6.74% APR, down 36 basis points from the previous week's average.
The 15-year fixed-rate mortgage averaged 5.95% APR, down 28 basis points from the previous week's average.
The five-year adjustable-rate mortgage averaged 6.95% APR, down 10 basis points from the previous week's average.
Last Thursday, March 9, the trajectory of mortgage interest rates seemed clear — and it was upward. Mortgage rates had risen relatively steadily for five straight weeks, and Federal Reserve Chair Jerome Powell emphasized in remarks to Congress that rate hikes would not only continue but could grow in size. Markets anticipated a 50-basis-point increase to the federal funds rate at the Federal Reserve's March meeting.
Not many people had bank failures on their 2023 bingo cards, but here we are. On Friday, March 10, Silicon Valley Bank collapsed, followed by Signature Bank on Sunday, March 12. (Disclosure: NerdWallet banked with SVB before its closure.) Though the Federal Deposit Insurance Corp. quickly took over those banks, ensuring depositors could access their funds, fears of contagion and bank runs were already roiling the markets.
Why did this lower mortgage rates? It's not just that whether the Federal Reserve would hike rates at all was now an open question. (The central bank ended up raising the federal funds rate a quarter of a percentage point.) It's also that freaked-out investors are looking to the relative security of the bond market. That demand for bonds is pushing their prices up, which sends mortgage rates down. Will rates stay low — or go even lower? Alas, markets are unpredictable at the best of times, and these are not those times.
