Number: U.S. mortgage rates continue to rise, adding hundreds of dollars to potential homeowners.
Mortgage Rate Rise Follows Federal Reserve Board interest rate hike to deal with the worst inflation the economy has faced in 40 years.
30-year fixed-rate mortgages averaged 6.29% as of September 15th. data It was released by Freddie Mac on Thursday.
This is up 27 basis points from the previous week. One basis point equals one hundredth of a percentage point.
Rising interest rates are bad news for prospective buyers, as they can add hundreds of dollars to your mortgage payments.
Mortgage rates are now at their highest level since 2008, said Bob Broeksmit, president and CEO of the Home Loan Bankers Association, in a statement.
A typical mortgage applicant’s monthly payment is $456 more than in January, he added.
Given rising interest rates and pullbacks from buyers, the median price of existing US homes fell to $389,500 in August from $403,800 the previous month. The National Association of Realtors said.
A year ago, the interest rate on a 30-year mortgage was 2.88%.
The average 15-year mortgage rate also rose to 5.44% over the past week.
The average variable rate mortgage rate was 4.97%, up from the previous week.
“The housing market continues to face headwinds, with mortgage rates rising again this week after 10-year Treasury yields jumped to their highest level since 2011,” Freddie Mac chief economist Sam Cater said in a statement. confronting.
“Affected by rising interest rates, house prices are softening and home sales are declining,” he added.
The country still faces a shortage of homes for sale. Redfin’s chief economist, Daryl Fairweather, told MarketWatch:
“That means there are fewer homes on the market, so while buyers are pulling back, so are sellers,” she added.
Meanwhile, mortgage applications rose in anticipation of further interest rate hikes last week. Buyers want to enter the market before mortgage rates rise further.
Ultimately, housing prices will fall as a result of rising interest rates, and sellers will react to lower demand by “Good thingsaid Federal Reserve Chairman Jerome Powell. at Wednesday’s press conference when they announced a rate hike.
“House prices were rising at an unsustainable rate,” Powell said.
“In the long run, supply and demand need to be better aligned so that house prices can rise at reasonable levels and people can buy homes again,” he added. “The housing market may need to go through an adjustment to get back on track.”
Yields on 10-year government bonds rise
It crossed 3.6% in Thursday morning trading.
Thinking about the housing market? Write to MarketWatch reporter Aarthi Swaminathan ([email protected]).