For the second week in a row, U.S. mortgage rates rose followed by higher-than-expected inflation and unemployment. The 30-year fixed mortgage rate increased and averaged 6.88%, which increased by 62 basis points since the previous year with an average of 6.27%. The 15-year mortgage rose to 6.16%, an increase of 10 basis points compared to last week's 6.06% and an increase of 73 basis points from the previous year's 5.54%. Sam Khater, chief economist at Freddie Mac stated, “Mortgage rates have been drifting higher for most of the year due to sustained inflation and the reevaluation of the Federal Reserve’s monetary policy path.” While this may be disheartening news for new and eager homebuyers, there's a glimmer of hope as new listing activating jumped by 15.5% in March. Although higher rates erode housing affordability, the median monthly mortgage payment for a median-priced $378,250 home hit an all-time high of around $2800. Despite these challenges, there is optimism that the market might stabilize later in the year as mortgage rates and housing supplies adjust.
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2 comments:
The expected potential market stabilization comes from the idea that later in the year rates will fall, but I wonder if the Fed keeps pushing it back and declining to adjust them lower how worse mortgage rates and affordability challenges could get.
How do you think the rise in U.S. mortgage rates is affecting the housing market, particularly for new homebuyers? And what factors do you think are driving the recent increase in U.S. mortgage rates?
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