Mortgage rates have been stuck near 6.5%, making it challenging for homebuyers to afford homes. The current rates are hovering near the highest levels of the year, with the average 30-year fixed mortgage at 6.49%, according to Freddie Mac.

Housing Market Challenges

The housing market is facing several challenges, including a shortage of homes for sale, which has driven prices higher. The recent conflict with Iran and the resulting inflation spike have kept mortgage rates high, while fears of potential interest rate hikes by the Federal Reserve have added to the uncertainty.

A bipartisan housing bill, the 21st Century Road to Housing Act, aims to boost the supply of homes and ease affordability strain over the next few years. The bill is set to automatically become law unless President Donald Trump vetoes it. The law would make it easier to add manufactured homes and offer grants and forgivable loans to repair existing homes.

Impact on Homebuyers

The high mortgage rates are keeping some buyers on the sidelines, with sales of existing homes falling by 2.4% in June compared to May. However, compared to June of last year, sales increased by 2.8%. The median existing home sales price continues to climb, hitting a record high for the month of June of $440,600.

Experts say that while the new housing law may not immediately improve home prices or availability, it could bring relief to homebuyers over time. Zillow expects mortgage rates to drift lower, to about 6.3% by the end of 2026, which would still be higher than the rates at the end of 2025.

Original reporting: El Paso News (HLL/CB) — read the source article.