### Mortgage Rates Stabilize Amid Financial Market Adjustments to Second Trump Presidency

Mortgage rates have stabilized this week as financial markets adapt to the reality of a second term for President-elect Donald Trump. According to Freddie Mac, the average 30-year mortgage rate remained almost unchanged at 6.78% as of Wednesday, compared to 6.79% a week earlier. Similarly, the average 15-year mortgage rate showed little movement, settling at 5.99% this week, down from 6% the previous week.

Following President-elect Trump's victory, 10-year Treasury yields, which are closely tied to mortgage rates, spiked. This increase indicates that traders anticipate Trump's taxation and spending policies will necessitate sustained higher interest rates. Sam Khater, chief economist at Freddie Mac, remarked, "After a six-week climb, rates have leveled off, but overall affordability continues to be an issue for potential homebuyers. Our latest research shows that mortgage payments compared to rents on the same homes are elevated relative to most of the last three decades."

The Federal Reserve's recent 25 basis point reduction in benchmark interest rates had minimal impact on mortgage rates, largely because the move was widely expected. Mortgage rates typically respond more to forecasts about the central bank's future actions rather than immediate rate cuts. According to CME FedWatch data, traders are now focusing on the Fed's potential actions in December, with over 76% of them anticipating another 25 basis point cut next month.

Despite mortgage rates hovering in the higher 6% range, the Mortgage Bankers Association reported a 2% increase in applications to purchase new homes compared to a week earlier, reversing several weeks of declines. This surge was driven partly by applications for FHA and VA loans, which often carry lower interest rates than conventional mortgages. Meanwhile, refinancing applications dropped again, hitting their lowest levels since May 2024.