Mortgage rates dropped by the most in more than two years last week. 30 year mortgage rates dropped to 5.1% from 5.25%, according to Freddie Mac in a statement Thursday. That would make it the biggest decline since April of 2020, although rates are still above the rate at the end of last year, of 3.11%.

While this was the second week in a row rates declined, and should offer consumers a slight reprieve, demand has suffered under the last four months of rapid rises combined with surging home prices. New home sales have dropped to the lowest level since the start of the COVID lockdowns. Pending home sales also have declined in April – the sixth straight month they have done so.

Joel Berner, Realtor.com’s senior economic research analyst wrote, “Mortgage rates leveling off is a lifeline for prospective homebuyers already dealing with inflation and record-high listing prices, and welcome news for the housing market at large. Dark and stormy is the current mood, but a period of steadier rates below recent highs will give buyers, sellers, and builders alike the time to adjust to the new financial environment.”

Sam Khater, Freddie Mac’s chief economist wrote, “Mortgage rates decreased for the second week in a row due to multiple headwinds that the economy is facing. Despite the recent moderation in rates, the housing market has clearly slowed, and the deceleration is spreading to other segments of the economy, such as consumer spending on durable goods.”