Average long-term US mortgage rate rises for again, reaching highest level more than five months
The average rate on a 30-year mortgage climbed this week to its highest level in more than five months, pushing up borrowing costs for prospective homebuyers in what’s typically the housing market’s busiest stretch of the year
LOS ANGELES — The average rate on a 30-year mortgage climbed this week to its highest level in more than five months, pushing up borrowing costs for prospective homebuyers in what's typically the housing market's busiest stretch of the year.
The rate rose to 7.22% from 7.17% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.39%.
When mortgage rates rise, they can add hundreds of dollars a month in costs for borrowers. That limits how much homebuyers can afford at a time when a relatively limited number of homes on the market coupled with heightened competition for the most affordable properties has kept prices marching higher.
The average rate on a 30-year mortgage has now increased five weeks in a row. It hasn't been this high since November 30.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also rose this week, lifting the average rate to 6.47% from 6.44% last week. A year ago, it averaged 5.76%, Freddie Mac said.
Mortgage rates are influenced by several factors, including how the bond market reacts to the Federal Reserve’s interest rate policy and the moves in the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
After climbing to a 23-year high of 7.79% in October, the average rate stayed below 7% this year until last month, as stronger-than-expected economic data and inflation dimmed optimism among bond investors that the Fed would be able to start cutting its short-term
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