The average 30-year fixed rate mortgage was 6.27% yesterday, unchanged since the day before. The 15-year fixed mortgage rate stood at 5.33%, the same as one the day before. The 30-year FHA mortgage averaged 5.56% yesterday, having stayed the same. Meanwhile, the 30-year jumbo mortgage rate was 6.63%, reflecting no change.
The bigger picture
The government shutdown enters its fourth week at midnight tomorrow. But there's little sign of an early resolution.
"Government shutdowns are usually resolved only after the pain they inflict on everyday Americans forces elected officials in Washington to come to an agreement," says The New York Times. "But as the shutdown nears a fourth week, Mr. Trump’s actions have instead reduced the pressure for an immediate resolution and pushed his political opponents to further dig in."
And his opponents appear ready to oblige. "We’re not going to bend. We’re not going to break," quotes The Times of remarks by Representative Hakeem Jeffries, Democrat of New York and the minority leader, on Friday.
One reason for that lack of progress is that voters are apportioning blame fairly evenly across the two parties. An AP-NORC Center for Public Affairs Research poll, published last Thursday, found 58% of respondents holding the president and Republicans in Congress responsible, and 54% saying it's the Democratic party's fault.
So, at this point, neither side needs to panic. But that might change if the shutdown drags on.
It's worth noting that this is an all-American quirk. No other nation has a system that allows government shutdowns.
Shutdowns and mortgage rates
Assuming the government doesn't reopen today, the current shutdown will be the third longest in history, according to USA Today. If it goes on beyond Wednesday, it will be the second-longest.
The longest occurred during President Donald Trump's first term and lasted 35 days. The current one would have to continue beyond November 5 to take that crown. Recently, House Speaker Mike Johnson suggested this could be one of the "longest shutdowns in American history."
The economic consequences of shutdowns tend to be cumulative, meaning they worsen as they drag on. And that's typically good for mortgage rates, which usually fall as economic conditions deteriorate.
Our preferred source for mortgage-rate data, ICanBuy, reckons the average for a 30-year fixed-rate mortgage had fallen to 6.27% by last Friday, compared with 6.37% the day before the shutdown began. That drop's not earthshattering, and it may not all be down to the shutdown, but it's worth having.
We shouldn't be surprised if the current shutdown becomes the longest in history. But we'll be shocked if it lasts through the Thanksgiving weekend.
By then, most government employees will have gone for nearly two months without a paycheck. And that's bound to have an impact on retail sales and debt delinquencies.
Perhaps more importantly, air traffic controllers will be in that situation. Imagine having one of the most stressful jobs on the planet while being stressed even more by money problems.
"Flight delays in some parts of the U.S. have ticked up since federal funding lapsed on Oct. 1, even as controllers, Transportation Security Administration officers and other air safety personnel are required to work without pay," reported CBS News last Thursday. "Previous shutdowns have resulted in a spike in TSA officers and air traffic controllers calling out sick from work, contributing to delays and flight cancellations."
Imagine that happening over a Thanksgiving weekend. The good thing is that such a prospect will soon be keeping legislators awake at night.
Mortgage Rate Trends: Past 90 Days
Purchase Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.27% | 6.3% | +0% | -0.05% |
| 15-Year Fixed | 5.33% | 5.38% | +0% | -0.03% |
| 30-Year Fixed FHA | 5.56% | 6.78% | +0% | -0.06% |
| 30-Year Fixed VA | 5.7% | 5.85% | +0% | -0.02% |
| 30-Year Fixed USDA | 5.73% | 5.87% | +0% | +0.01% |
| 30-Year Fixed Jumbo | 6.63% | 6.65% | +0% | -0.11% |
| 5/6 Year ARM | 6.18% | 6.22% | +0% | -0.1% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.3% | 6.32% | +0% | -0.11% |
| 15-Year Fixed | 5.3% | 5.34% | +0% | -0.05% |
| 30-Year Fixed FHA | 5.51% | 6.73% | +0% | -0.06% |
| 30-Year Fixed VA | 5.73% | 5.87% | +0% | -0.04% |
| 5/6 Year ARM | 6.18% | 6.21% | +0% | -0.19% |
What's coming up?
Although economic reports are usually the main drivers of changes to mortgage rates, they're not the only ones. The general mood in markets and economically consequential news can also affect those rates. News items concerning employment, inflation, tariffs and deficit funding are especially influential at the moment.
The shutdown means almost no official economic data will be published until the government reopens. So far, there is only one exception. The September consumer price index is scheduled for release this Friday.
Mortgage rates today
There is only one economic report on today's MarketWatch economic calendar. The independent Conference Board publishes the leading economic indicators report, and is unaffected by the shutdown.
Markets expect this September report to show a small improvement, up to -0.3% from August's -0.5%.
This report doesn't typically affect mortgage rates much, if at all. However, it's the only report due before Thursday, so it's harder than normal for investors to miss.
Generally, mortgage rates fall when reports underperform market expectations, and rise when numbers exceed forecasts.
