When most of us hear “mortgage rates below 6%”, you can almost feel the sigh of relief—like winning a mini lottery. And yes, it’s good news, but let’s not oversell it. As of mid August 2025, the average rate on a 30 year fixed mortgage has slipped to 6.63%—the lowest since April. Still, it hasn’t broken the 6% barrier yet. Let’s break down what’s really going on—and what truly moves the needle for homebuyers.
The Reality: Most Borrowers Are Already Enjoying Rates Under 6%
Believe it or not, over 81% of outstanding mortgages are already below that 6% mark. So yes—those new buyers coming in at ~6.6% are actually paying more than many current homeowners. That keeps a massive “lock-in effect” firmly in play: people with low-rate loans simply aren’t in any hurry to move.
Why We’re Still Watching Rates Like Hawks
- Small Relief, Real Impact – Mortgage rates fell about ~0.05 percentage points (to 6.63%)—a modest drop, but not nothing.
- Greater Inventory Brings Buyer Power – Listings are up nearly 25%, pushing active For-Sale inventory above 1.1 million. Homes are staying on the market longer, letting buyers catch a break on pricing and options.
- Affordability Still Gets Squeezed – Even with a drop to “low 6s,” carrying costs remain high compared to previous years. While it helps, it’s no reset button on affordability.
Built Different Takeaways
- Don’t Let the “<6%” Headline Fool You – New buyers are often competing with sellers who locked in much lower rates.
- Better Rates Are Nice—but They’re Just One Piece – Lower rates help, but inventory and negotiating power matter too.
- Better Than Nothing? Yes. Game-Changer? Not Yet – The dip to ~6.63% is welcome, but affordability is still tight.
TL;DR: Built Different Housing Market
- Headline Relief: Average 30-year rate = 6.63%, lowest since April.
- Most People Already Beat That: ~81% of mortgages are below 6%.
- Inventory Boost = Buyer Leverage: Listings up ~25%, longer market times.
- Lock-In Reigns: Low-rate holders are staying put, limiting turnover.
- Bottom Line: Slow easing, not affordability relief—yet.
