WASHINGTON – U.S. mortgage rates fell this week, but an uncertain economic outlook and tepid hiring are keeping prospective homebuyers on the sidelines.

The average rate on the popular 30-year fixed-rate mortgage dropped to 6.30% from 6.34% last week, mortgage finance agency Freddie Mac said on Thursday. It averaged 6.32% during the same period a year ago. 

Mortgage rates have eased as the Federal Reserve resumed cutting interest rates amid a stagnant labor market, characterized by low layoffs and lackluster hiring. There has been no surge in home loan applications, with homeowners taking advantage of the lower borrowing costs to refinance. 

A separate report from real estate company Redfin confirmed buyers remain hesitant, noting that pending home sales decreased 1.3% from a year ago in September, the biggest drop in five months.

“But buyers aren’t budging,” Redfin said. “The typical home that sells is taking 48 days to go under contract, a week longer than last year and the longest September span since 2019.” 

Redfin said its agents in much of the country reported that prospective homeowners were waiting for mortgage rates to drop even further before wading back into the market. 

“Some prospective buyers are also wary of making a big purchase while the economy is uncertain, with the government shutdown and recent weak jobs reports making some Americans insecure about their finances,” Redfin said.