The average rate on a 30-year fixed-rate mortgage was nearly unchanged this week but reached its lowest level in two years.

Thirty-year mortgage rates averaged 6.08% as of Thursday, down from 6.09% a week earlier, according to Freddie Mac data.

Average 15-year mortgage rates rose one basis point to 5.16%.

As mortgage rates hover around 6%, potential buyers are tiptoeing back into the market, and some homeowners who bought when interest rates topped 7% are weighing refinancing. Mortgage applications jumped to the highest level in more than two years last week, driven largely by refinancing volumes.

“Given the downward trajectory of rates, refinance activity continues to pick up, creating opportunities for many homeowners to trim their monthly mortgage payment,” Sam Khater, Freddie Mac’s chief economist, said in a statement. “Meanwhile, many looking to purchase a home are playing the waiting game to see if rates decrease further as additional economic data is released over the next several weeks.”

Thirty-year mortgage rates have dropped more than a percentage point since May.

Read more: Mortgage and refinance rates today, September 26, 2024: Rates finally decrease

The Pending Home Sales Index, a measure of housing contract activity, rose 0.6% to 70.6 in August, improving slightly from July’s record-low reading, according to the National Association of Realtors. A level of 100 is equal to the amount of contract activity seen in 2001.

“Buyers are finally getting more comfortable with the rate,” said Selma Hepp, chief economist at real estate data provider CoreLogic. “I don’t think that’s going to mean a big boost for home sales this year given how low they’ve been so far, but still, it’s a little bit of improvement.”

Claire Boston is a senior reporter for Yahoo Finance covering housing, mortgages, and home insurance.

Click here for real estate and housing market news, reports, and analysis to inform your investing decisions

Click here for more information and tools to help you handle your finances

Öztopçu explains that while consumers are rapidly diversifying within the financing ecosystem, there is a genuine need for new generation financing products capable of responding to this diversity: “Seizing and developing technological opportunities, especially AI, enables companies to develop new production methods and tools, do a much better job at sizing up their competitors, and build creative competitive strategies.”

As Generation Z enters its peak earning years, it has become the target of all sectors of the economy, Öztopçu notes. Generation Z prioritizes convenience over everything else, and appreciates special, innovative financial benefits, such as promotions and discounts. Öztopçu reports that Gen Z’ers also do a lot of their shopping on social media, but always after doing proper research, and rarely on impulse. To help them, they browse online channels and watch videos if necessary.

According to Öztopçu, this generation looks for the same perks and promotions when they are looking for financial products, such as loans, interest rates, and payment flexibility.  In fact, when offered by brands, it builds greater customer loyalty among Gen Z’ers – even more so when the brands develop financial products that are customized to meet their needs.

Öztopçu explained that if a consumer uses a product developed in collaboration by brands and financial institutions, they visit the brand’s mobile app or website three times a month on average, and these visits convert into sales. During this transition period, the use of these hybrid structures is bound to become more widespread, as they are especially good at engaging with the customer, helping brands understand their needs and guiding them.

Therefore, according to Öztopçu, if consumer finance companies or banks insist on using traditional databases, they must be ready to work harder to offer new products that can keep up with changing consumer financing trends and lending habits.

The Dow Industrial Jones Average (^DJI) is pulling back Wednesday, after reaching an all-time high in the previous session. Investors are now turning their attention to Friday’s PCE report to help assess whether the Federal Reserve will continue its aggressive rate-cutting cycle. Meanwhile, Micron Technology (MU) is in focus on Wall Street as the chip giant gears up to report it’s fourth-quarter results after the market closes.

Yahoo Finance trending tickers include Rocket Lab (RKLB), Ford Motor Company (F), and Rivian Automotive (RIVN).

Key guests include:
3:05 p.m. ET Kate Moore, BlackRock Global Allocation Fund Head of Thematic Strategy
3:30 p.m. ET Alonso Munoz, Hamilton Capital Chief Investment Officer
3:45 p.m. ET Michael Lasser, UBS U.S. Hardline & Broadline and Food Retail Analyst
4:15 p.m. ET Daniel Morgan, Synovus Trust VP and Senior Portfolio Manager
4:40 p.m. ET Daniel Lubetzky, Kind Snacks Founder and Builders Movement Founder