Mortgage Rates Drop for First Time in 2 Months as Stock Market Jitters Drive Investors to Bonds

Mortgage rates fell for the first time in two months this week as investors sought safety in government bonds, spurred by cooling stock and tech markets and a sharp pullback in new-housing starts fueling inflation fears. The average rate on 30-year fixed home loans decreased to 7.32% for the week ending Oct. 22, down from 7.40% the prior week, according to Freddie Mac. The decline follows seven consecutive weeks of gains that sent mortgage rates to three-year highs. For perspective, rates averaged 6.19% one year ago."The average 30-year fixed-rate mortgage declined this week, offering some relief to prospective homebuyers," says Sam Khater, Freddie Mac's chief economist.The main driver behind this reversal is the 10-year Treasury yield, which averaged roughly 5.13% over the past several days, down from 5.24% the week before—the result of investors adopting a more cautious stance as they follow the ongoing conflict in Iran and await initial unemployment claims data. It also comes on the heels of worse-than-expected housing data, with housing starts plunging in September 5.2% month over month and 7.4% year over year, according to a report from the U.S. Census Bureau released Tuesday....