US Median Mortgage Payment Drops to Seven-Month Low

On Thursday, Redfin reported that the median monthly mortgage payment fell to a seven-month low of $2,631 during the four weeks ending August 10, down $215 from its May peak of $2,846. Last week marked the 12th consecutive week that monthly payments either declined or stayed flat.

Monthly payments are easing because mortgage rates have dropped to a 10-month low, falling to 6.53% on Wednesday—the lowest since October 2024. That means a buyer with a $3,000 monthly budget gained roughly $20,000 in purchasing power since rates hit 7.08% in May.

Redfin said the median home price rose to $396,000 during the four weeks ending August 10, up 2.1% year-over-year. This was the fastest growth since early April and the fifth consecutive week of accelerating price gains, following a two-year low in early July.

Commenting on the report, Redfin Head of Economic Research Chen Zhao said:

“The mortgage rates that buyers can lock in today have already priced in the likelihood that the Fed will cut rates on September 17. That means that mortgage rates are unlikely to drop any further when the Fed actually makes the expected cut. And the window to snag a mortgage rate in the mid-6s may be limited: Increased rate volatility is expected in coming weeks as new economic data is released.”