Mortgage Rates: Where We Stand Today
As of August 19, 2025, the average 30-year fixed mortgage rate in the U.S. is holding near 6.60%, up slightly from 6.59% the previous day, according to Mortgage News Daily’s daily survey. This marks a modest increase from mid-August but remains near this year’s lows Similar figures were reported by Freddie Mac, with their weekly average settling at 6.58% as of August 14.
These levels—though elevated compared to historic lows—represent a calm stabilization in mortgage rate dynamics for 2025.
Recent Trends & What’s Driving Rates
Treasury Yields: Key Benchmark Movement
A slight decline in the 10-year Treasury yield—currently at 4.313%—has exerted some downward pressure on mortgage rates, as mortgages often follow Treasury yield trends.Federal Reserve Posture
The Federal Reserve has maintained its federal funds rate between 4.25%–4.50% since March and through late July and early August. While speculative chatter about a September rate cut is gaining traction, experts caution that cuts may not directly translate to significantly lower mortgage rates.Outlook for the Remainder of 2025
Analysts anticipate only modest declines in mortgage rates by year-end. For example, Realtor.com and others forecast a gradual pull toward the 6.4% range, possibly inching lower if inflation eases or trade tensions ease. Yet, lingering inflation and political uncertainty could temper any sharp decline.
What Controls Mortgage Rates
Long-Term Economic Expectations
Rates reflect bond market sentiment—especially inflation and growth projections—not just Federal Reserve actions.Federal Reserve Policy & Market Reaction
While the Fed influences short-term rates and economic expectations, mortgage rates follow longer-term trajectories.Treasury Yields as a Barometer
The 10-year Treasury yield remains one of the most direct predictors of mortgage rate direction.Borrower & Loan-Specific Criteria
Individual factors like credit score, down payment, loan-to-value ratio, loan type (fixed vs. adjustable), and risk-based pricing strategies influence the rate each borrower receives.External Economic & Geopolitical Factors
Inflation data, trade policy developments, and political statements—especially from the President or Fed officials—can sway rate expectations.
Outlook: What Lies Ahead
While rates have softened mildly from recent peaks, they remain elevated in historical terms, suggesting a range-bound environment for now. Many experts anticipate further gradual easing, potentially dipping into the low-6% range by late 2025, contingent on:
Cooling inflation
Looser Fed policy or dovish guidance
Market confidence returning
However, if inflation remains sticky or geopolitical uncertainty persists, rate relief may prove incremental at best.
Thinking Beyond Arizona?
As a reminder, Neighborhood Loans collaborates with an out-of-state investment group that specializes in helping Arizona investors acquire rental properties in other states, offering white-glove service—from property sourcing to management. If you're curious about out-of-state diversification, we’re happy to make an introduction or arrange a consultation.