Mortgage Rates Climb to One-Year High, Freddie Mac Reports
Key Takeaways
- •The average 30-year fixed-rate mortgage increased to 6.66%, marking the highest level in a year and up from 6.58% the previous week.
- •The 15-year fixed-rate mortgage rate also rose, reaching 6.04% compared to 5.96% in the prior week.
- •Mortgage rates have remained above 6% for most of the period since the Federal Reserve began aggressively raising its benchmark rate in 2022.
- •Freddie Mac's chief economist Sam Khater indicated that growing housing inventory is providing more options for buyers despite fluctuating borrowing costs.
- •Mortgage rates generally track the yield on the 10-year Treasury note, which responds to investor expectations about inflation and Federal Reserve policy direction.
Mortgage rates in the United States rose this week to their highest level in a year, according to data released Thursday by Freddie Mac, as borrowing costs continue to be influenced by the Federal Reserve's efforts to manage inflation through elevated interest rates.
Freddie Mac's latest Primary Mortgage Market Survey showed the average rate on the benchmark 30-year fixed-rate mortgage climbed to 6.66%, up from 6.58% the previous week. A year earlier, the average 30-year rate stood at 6.72%. Mortgage rates have remained above 6% for most of the period since the Fed began aggressively raising its benchmark federal funds rate in 2022, a sharp departure from the sub-3% levels that prevailed during the pandemic-era housing boom.
Sam Khater, Freddie Mac's chief economist, said the broader housing market is seeing some improvement on the supply side. "The housing market continues to benefit from more available inventory, providing prospective homebuyers with additional options and helping support buyer activity as mortgage rates fluctuate," Khater said. Rising inventory marks a shift from the chronic supply shortages that constrained the market in recent years, though higher rates continue to limit affordability for many buyers by increasing monthly payments on new loans.
The average rate on a 15-year fixed-rate mortgage also moved higher, rising to 6.04% from 5.96% the prior week.
Freddie Mac, officially the Federal Home Loan Mortgage Corporation, is a government-sponsored enterprise that publishes the Primary Mortgage Market Survey each week. The survey is one of the most widely followed benchmarks for U.S. mortgage rates and aggregates data from lenders across the country. Mortgage rates typically track the yield on the 10-year Treasury note, which moves in response to investor expectations about inflation and the trajectory of Fed policy.
In a separate segment, Phil Blancato, Chief Market Strategist at Oscorp, advised investors to avoid emotional decision-making when managing their portfolios.
The source article is available at Fox Business.