The 30-year mortgage rate has toppled to a 2-month low as the US housing market sees pickup in purchase demand

• The 30-year fixed mortgage rate tumbled to 6.49%, the lowest level since September.
• The rate has dropped 65 basis points over the last three weeks and 18 basis points in the last week alone.

The 30-year mortgage rate fell to the lowest level since September, and demand to purchase homes continued to edge higher.

According to data from the Mortgage Bankers Association, the 30-year fixed mortgage rate slipped to 6.49% in the week ending on November 25, down 65 basis points over the last three weeks and 18 basis points in the last week alone.

Meanwhile, the MBA's mortgage purchase index rose 3.8%, marking the fourth straight gain. But refinance demand dropped 13%, sending overall application volume down 0.8%.

The central bank has hiked rates by 375 basis points so far this year in a scramble to rein in sky-high inflation. That lifted bond yields, sending mortgage rates to 20-year-highs and causing existing home sales to buckle 24% in September.

But expectations that the Fed will start slowing the pace of its tightening has sent bond yields back down along with mortgage rates.

Still, industry experts are anxious over the health of the industry, with real estate brokerage Redfin predicting that home sales could continue to fall through 2023, and economists warning that housing prices could soon crater as more stress is exerted on the sector.