The average rate on a 30-year mortgage fell this week to its lowest level in more than a year, a welcome affordability boost for prospective home shoppers and homeowners looking to refinance their home loan to a lower rate.
The rate fell to 6.47% from 6.73% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.96%.
This is the second straight weekly drop in the average rate. It’s now the lowest it’s been since mid-May last year, when it was 6.39%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell this week, pulling the average rate down to 5.63% from 5.99% last week. A year ago, it averaged 6.34%, Freddie Mac said.
“The decline in mortgage rates does increase prospective homebuyers’ purchasing power and should begin to pique their interest in making a move,” said Sam Khater, Freddie Mac’s chief economist. “Additionally, this drop in rates is already providing some existing homeowners the opportunity to refinance.”
After jumping to a 23-year high of 7.79% in October, the average rate on a 30-year mortgage has mostly hovered around 7% this year — more than double what it was just three years ago.
The elevated mortgage rates, which can add hundreds of dollars a month in costs for borrowers, have discouraged home shoppers, extending the nation’s housing slump into its third year.
Sales of previously occupied U.S. homes fell in June for the fourth month in a row. And sales of new single-family homes fell last month to the slowest annual pace since November.
Rates have mostly eased in recent weeks as signs of waning inflation and a cooling job market have raised expectations that the Federal Reserve will cut its benchmark interest rate next month for the first time in four years.
Mortgage rates are influenced by several factors, including how the bond market reacts to the central bank’s interest rate policy decisions. That can move the trajectory of the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
This week’s drop in mortgage rates follows a pullback in the 10-year Treasury yield, which briefly slid last week to around 3.7% after worse-than-expected labor market data rattled investors, pushing up demand for bonds.
The yield, which topped 4.7% in late April, was at 4% in afternoon trading in the bond market on Thursday.
If bond yields continue to decline in anticipation of the Fed lowering rates this fall, that could lead mortgage rates to ease further, though most economists expect the average rate on a 30-year home loan to remain above 6% this year.
Even so, the recent pullback in mortgage rates has already spurred a surge in homeowners seeking to refinance. Applications for mortgage refinance loans jumped last week to their highest level in two years.
Rates may have to come down more before many would-be homebuyers facing record-high housing prices and a chronic shortage of properties on the market can afford to buy a home.
“Buyers are biding their time, waiting for rates to fall further and for more inventory to come onto the market,” said Lisa Sturtevant, chief economist at Bright MLS.
FILE - A housing development in Cranberry Township, Pa., is shown on March 29, 2024. (AP Photo/Gene J. Puskar, File)
LAWRENCEBURG, Ky. (AP) — As bourbon fans flocked to the Wild Turkey visitors' center, sitting near the entrance was no ordinary greeter. Jimmy Russell, who has lived through so much of the distillery's rich history, was at his post as a goodwill ambassador, signing whiskey bottles, posing for photos and chatting up tourists about his favorite topics — making bourbon and sipping it.
For 70 years, the distillery in the heart of Kentucky's picturesque bourbon country has been Russell's home away from home. He learned his craft from a distiller who endured the dark days of Prohibition. Decades later, Russell was a key player in bourbon's revival — creating some of the premium whiskeys that are cocktail staples and becoming a global front man for his brand and the bourbon sector.
The 89-year-old Russell, known affectionately as the “Buddha of Bourbon,” marked his 70th anniversary at the distillery on Tuesday. For nearly a half-century, he was master distiller at Wild Turkey, putting him in charge of every step of production — from distillation to bottling.
“I always said, ‘The first day I have to come to work I’m retiring,’” he said recently.
That day still hasn't arrived.
Russell is a beloved fixture at the distillery, nearly a decade after turning over master distiller duties to his son, Eddie. Both father and son are members of the Kentucky Bourbon Hall of Fame, and the next generation is building on their legacy. Bruce Russell, Eddie's son and Jimmy's grandson, works as associate blender, putting him at the center of creating new Wild Turkey products.
The Russell family has a long history of being top executives heading the production and, in later years, the promotion of the brand. It also isn’t uncommon for master distillers to have long careers with a distillery and later become brand ambassadors. But Jimmy's longevity puts him in a special class.
The elder Russell teamed up with his son and grandson on a special project recognizing the family's whiskey-making tradition. Wild Turkey Generations was created by combining aged bourbons selected by each of them to reflect their own personal preferences. The bourbons were then blended to create the ultra-premium whiskey that had a limited release last year.
“I got to work on a project with him where all our names are on the bottle,” Bruce Russell said. “And that's super special for me.”
No longer part of the daily grind of bourbon making, Jimmy Russell still samples and offers his unvarnished opinion about some of the newest renditions of Wild Turkey being developed. But he typically spends time greeting tourists a few days each week at the visitors' center.
His easy-going charm was on full display a couple of weeks ago as Mark and Donna Barton asked him to sign bottles of Wild Turkey they purchased in the gift shop. Eddie Russell topped it off by adding his signature.
“Heck yeah, this is going to go on display,” Donna Barton said.
Whether the couple from Princeton, West Virginia, drinks the contents of the signed bottles, or keeps them as unopened souvenirs, was “up for discussion,” Mark Barton said.
“We may crack it and have an ounce and then put it back up,” his wife added.
Jimmy Russell is a seasoned hand at charming and educating bourbon fans, having spent decades traveling the world to promote Wild Turkey. One big change through the years, he said, is the level of knowledge whiskey fans now have about their favorite bourbons.
“When I started, it was all whiskey, it didn’t make any difference," Russell said. "Nowadays, people know every little drop, every little thing about it.”
When he started in 1954, he said, the distillery had a different name — Anderson County Distilling — and the operation was much smaller, with about 40 barrels of whiskey produced daily and stored in four warehouses for aging, when bourbon gets its flavor and golden brown color. Wild Turkey — owned by the Italian-based Campari Group, which purchased the brand from French liquor company Pernod Ricard in 2009 — now produces 700 to 800 barrels of whiskey daily, stored in nearly three dozen warehouses. The brand sells globally and its biggest overseas markets include Japan and Australia. A second distillery is being built at the Wild Turkey complex to keep up with demand.
Unlike other distillery workers who typically stuck with one task, Russell rotated jobs early on, giving him the broader perspective that prepared him to take over as master distiller in 1967.
“As soon as I learned a job real well, they’d move me and put me on something else,” Russell said. “So I’ve done everything here.”
His son Eddie, now 64, had the same extensive training when joining Wild Turkey in 1981.
“He wanted me to learn it from the ground up, the same way he had,” Eddie Russell said.
Within a couple of weeks, he said he “knew it was home for me.” Other lessons he learned from his father: putting maximum effort into the job and being a stickler for product consistency, he said.
“The number one thing I tell everybody that I learned from Jimmy was if you're going to do something, do it right or don't do it at all,” Eddie Russell said.
Kentucky distillers are a close-knit group, and another renowned bourbon baron, Fred Noe, a seventh-generation master distiller at Jim Beam, says Jimmy Russell has been a valued friend and mentor, especially after the death of Noe's father, famed master distiller Booker Noe. Russell and Booker Noe were close friends.
“When I took over for my father, Jimmy became a second father figure to me, guiding me as I stepped into the role of bourbon ambassador,” Fred Noe said. "His friendship and passion for the industry he and my father loved shaped me into the man I am today.”
In Kentucky, where 95% of the world's bourbon is produced, the master distillers are treated as celebrities. If there was a Mount Rushmore of Kentucky bourbon, Jimmy Russell would be on it, said Eric Gregory, president of the Kentucky Distillers’ Association.
“You think about the names of him and his peers at the time, you're talking some of the most treasured, beloved and cherished names in the history of Kentucky bourbon,” Gregory said. “And they were doing this at a time when bourbon was not celebrated as it is today. They paved the way for the success of Kentucky bourbon today.”
Watching his son and grandson follow in his footsteps is what Russell treasures most.
“That’s what I’m so proud of, to see what they’re doing,” he said. "To see how far Eddie’s come along. He’s well-known everywhere now. Bruce is coming that way.”
His wife, Joretta, now 93, has been with him every step of the way, and Eddie Russell said she deserves credit for his father's longevity. The bourbon business wasn't discussed at home, as she made sure to keep her husband's work and home lives separate to help him relax, their son said.
“Jimmy and Dad are master distillers at work. But at home, granny’s the boss,” Bruce Russell said.
Of all the questions fans ask him, one constant is: how does he like his bourbon? Jimmy prefers it neat — without ice or a splash of water. However it's served, it should be sipped and savored, he said.
“Bourbon’s not something you sit and throw straight down," Russell said. "You sit and enjoy the flavor and taste of it. And I’ve always said, you know one thing about bourbon, you drink when you’re happy, you drink when you’re sad.”
And his sense of humor hasn't dimmed. Asked to name his favorite bourbon, he replied: “One of each.”
Eddie Russell, master distiller, and son of 89-year-old Jimmy Russell, the "Buddha of Bourbon" talks about having three generations of the Russell family involved in the bourbon industry at the Wild Turkey Distillery in Lawrenceburg, Ky., Wednesday, Aug. 28, 2024. (AP Photo/Timothy D. Easley)
FILE- Wild Turkey master distiller Jimmy Russell takes a sip of bourbon drawn from the barrel at a warehouse near Lawrenceburg, Ky., Aug. 22, 2014. (AP Photo/Bruce Schreiner, File)
FILE - Wild Turkey master distiller Jimmy Russell talks about bourbon making as he stands in a warehouse in Lawrenceburg, Ky., Wednesday, June 18, 2008. (AP Photo/Ed Reinke, File)
