Average long-term US mortgage rate jumps to 7.23% this week to highest level since June 2001
The average long-term U.S. mortgage rate climbed further above 7% this week to its highest level since 2001, another blow to would-be homebuyers grappling with rising home prices and a stubbornly low supply of properties on the market
LOS ANGELES — The average long-term U.S. mortgage rate climbed further above 7% this week to its highest level since 2001, another blow to would-be homebuyers grappling with rising home prices and a stubbornly low supply of properties on the market.
Mortgage buyer Freddie Mac said Thursday that the average rate on the benchmark 30-year home loan climbed to 7.23% from 7.09% last week. A year ago, the rate averaged 5.55%.
It’s the fifth consecutive weekly increase for the average rate, which is now at its highest level since early June 2001, when it averaged 7.24%.
High rates can add hundreds of dollars a month in costs for borrowers, limiting how much they can afford in a market already unaffordable to many Americans. They also discourage homeowners who locked in low rates two years ago from selling.
Mortgage rates have been rising along with the 10-year Treasury yield, used by lenders to price rates on mortgages and other loans. The yield has been climbing as bond traders react to more reports showing the U.S. economy remains remarkably resilient, which could keep upward pressure on inflation, giving the Federal Reserve reason to keep interest rates higher for longer.
“This week, the 30-year fixed-rate mortgage reached its highest level since 2001 and indications of ongoing economic strength will likely continue to keep upward pressure on rates in the short-term,” said Sam Khater, Freddie Mac’s chief economist.
High inflation drove the Federal Reserve to raise its benchmark interest rate
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