US mortgage rates are climbing nearly as fast as they were cut just a few months ago. Freddie Mac released its Primary Mortgage Market Survey this week. They found the 30-year fixed rate mortgage is now well over 5%, the highest rate since 2009. Higher costs to control inflation means a lot less time repairing tech.
US 30-Year Fixed-Rate Mortgages Hit 5.27%, Highest Since 2009
US mortgage rates have been rocketing higher since the beginning of the year. This week the 30-year fixed-rate mortgage climbed to an average of 5.27%, up 0.17 points from last week. Interest costs for this segment have increased 2.31 points since the previous year. From the lowest rate in history to the highest rate since 2009, all in less than a year.
US 30-Year Fixed-Rate Mortgage Interest
The weekly average of 30-year fixed-rate mortgages in the United States.
Source: Freddie Mac; Better Dwelling.
The 30-year fixed rate mortgage might be the most popular option, but it isn’t the only one impacted. The 15-year fixed-rate mortgage reached an average of 4.52% this week, up from 2.30% last year. ARMs, based on a Treasury Index, climbed to 3.96% this week, up from 2.70% over the same period. Mortgage interest costs at this level isn’t unheard of — it’s more unusual it’s this low. However, it was hard to find someone who thought this was possible a little over a year ago.
Home Price Growth Expected To Decelerate In Coming Months
Higher mortgage rates are beginning to slow demand for housing, says the organization. “While housing affordability and inflationary pressures pose challenges for potential buyers, house price growth will continue but is expected to decelerate in the coming months,” said Sam Khater, Freddie Mac’s Chief Economist.
A similar data point was shared earlier this week from the Mortgage Banker Association. In passing, they cited rising mortgage costs as the reason applications have plummeted.
Soaring inflation is proving to be sticky and in need of higher interest rates. In the coming months, as the Fed tries to fight inflation, borrowing costs will rise even further. With that increase will come even slower demand, and potentially falling home prices.