The Federal Reserve did not move last week, but mortgage rates did. Freddie Mac's July 30 survey showed the 30-year fixed averaging 6.66%, up from 6.58%, the highest level in about a year. The 15-year crossed 6% for the first time in months, averaging 6.04%. For context, the 30-year was 6.72% at this point in 2025, so we are now right back where we were last summer after a spring that had offered some relief.
The Fed's Next Move
On Wednesday the Federal Open Market Committee held the federal funds rate at 3.50% to 3.75%, as expected. What was not expected was the vote. Three regional presidents (Cleveland's Beth Hammack, Minneapolis's Neel Kashkari, and Dallas's Lorie Logan) dissented in favor of a quarter-point hike, the most dissents in one direction since September 2016. Chair Kevin Warsh called it a "family fight" and repeated that the Fed will deliver price stability. Markets took the hint: by Wednesday afternoon, futures priced roughly a 60% chance of a rate increase at the September 15-16 meeting.
The Fed does not set mortgage rates directly, but the shift in expectations pushed Treasury yields higher across the curve, and mortgage rates followed. This is the opposite of what most buyers were hoping for a year ago, and it means the path to lower rates now runs through the inflation data rather than through Fed generosity.
National Snapshot
The economic picture is mixed. Second-quarter GDP grew at a 1.5% annual rate, down from 2.1% in the first quarter, with consumer spending holding up but government spending and investment slowing. The Fed's preferred inflation gauge, the PCE index, fell 0.1% in June and eased to 3.7% year over year from 4.1%, with core PCE at 3.3%. That is progress, but still well above the 2% target, and the June improvement came from the energy price decline during the truce that has since reversed. Brent crude was about $87 this morning, and Chevron and Exxon both warned last week that fuel prices are likely to stay elevated while refining capacity is disrupted. Consumer confidence slipped to 90.8 in July, its third straight monthly decline.
Home prices nationally are barely keeping pace. The S&P Cotality Case-Shiller national index rose 1.1% year over year in May, which means home values fell in inflation-adjusted terms for the 12th month in a row. Regional gaps are wide, with Chicago up nearly 7% and Las Vegas down almost 2%.
What This Means for Central Utah
We will be honest: a 6.66% rate with a possible Fed hike in September is a tougher environment than we had in June. But it is not a reason to sit out if the numbers work for your family. A few practical thoughts for buyers in Sevier County and across Central Utah: ask your lender about temporary buydowns, which sellers and builders are increasingly willing to fund; explore USDA zero-down loans if you are buying in Richfield, Monroe, Salina, Loa, or another eligible rural community; and remember that a home purchased at a Central Utah price with a 6.66% rate often carries a smaller payment than a Wasatch Front rental.
For sellers, the Case-Shiller data is a reality check that prices are flat in real terms nationally. Locally, well-priced homes are still selling, but the buyers who remain are rate-sensitive and value-focused. Offering a closing-cost credit or a rate buydown can widen your buyer pool more effectively than another price cut. Our team can model both options for your home.
The July jobs report comes out Friday and will shape the September rate debate. We will cover it next week. As always, reach out with questions about mortgage rates, home buying, or home selling in Central Utah.