The average long-term U.S. mortgage rate eased back from a seven-month high this week, a welcome change for homebuyers navigating high borrowing costs and heightened competition for relatively few homes for sale.

Mortgage buyer Freddie Mac said Thursday that the average rate on the benchmark 30-year home loan fell to 6.71% from 6.79% last week. A year ago, the rate averaged 5.23%.

The pullback follows three straight weekly increases, which pushed up the average rate to its highest level since early November, when it climbed to 7.08%.

The average rate on 15-year fixed-rate mortgages, popular with those refinancing their homes, also fell this week, slipping to 6.07% from 6.18% last week. A year ago, it averaged 4.38%, Freddie Mac said.

High rates can add hundreds of dollars a month in costs for homebuyers, limiting how much they can afford in a market that remains out of reach to many Americans after years of soaring home prices. They also discourage homeowners who bought their home or refinanced in recent years when rates on a 30-year mortgage were around 3% from selling now that rates have roughly doubled. That’s one reason the number of homes on the market remains near historic lows.

“While elevated rates and other affordability challenges remain, inventory continues to be the biggest obstacle for prospective homebuyers,” said Sam Khater, Freddie Mac’s chief economist.

The U.S. housing market has been slow to regain its footing this year, limited by elevated mortgage rates and the thin inventory of available homes.

Sales of previously occupied U.S. homes fell 23.2% in the 12 months ended in April, marking nine straight months of annual sales declines of 20% or more, according to the National Association of Realtors.

The dearth of homes on the market has helped prop up prices. The national median home price fell to $388,800 in April — down only 1.7% from a year earlier.

Homebuyers who can afford to bypass the higher costs of borrowing on a home loan are increasingly doing so. Some 33.4% of U.S. homes purchased in April were paid for in cash, according to data from real estate brokerage Redfin. That’s up from 30.7% a year earlier, and represents the largest share of all-cash purchases in nine years.

Mortgage rates ticked higher in recent weeks along with the 10-year Treasury yield, which lenders use as a guide to pricing loans. The yield hit 3.81% two weeks ago, its highest point since early March. It was at 3.74% in midday trading Thursday. Investors’ expectations for future inflation, global demand for U.S. Treasurys and what the Fed does with interest rates influence rates on home loans.

Uncertainty over what the Fed will do at its interest rate policy meeting next week, and beyond, could keep the bond market on edge, driving more mortgage rate volatility.

The Fed has raised its benchmark interest rate 10 times in 14 months in a bid to lower stubbornly high inflation. Fed Chair Jerome Powell and other central bank officials have recently signaled that the Fed may forego another interest rate hike at this month’s meeting of policymakers. Such a move would give the Fed time to evaluate the economic impact of its previous rate increases.

(AP)