Average long-term US mortgage rate surged to nearly 7% this week to highest level since November
The average long-term U.S. mortgage rate climbed this week to just under 7%, the highest level since November and the latest setback for homebuyers already grappling with a tough housing market constrained by a dearth of homes for sale
LOS ANGELES — The average long-term U.S. mortgage rate climbed this week to just under 7%, the highest level since November and the latest setback for homebuyers already grappling with a tough housing market constrained by a dearth of homes for sale.
Mortgage buyer Freddie Mac said Thursday that the average rate on the benchmark 30-year home loan rose to 6.96% from 6.81% last week. A year ago, the rate averaged 5.51%.
It’s the third consecutive week of higher rates, lifting the average rate to its highest level since it surged to 7.08% in early November. 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.
The latest increase in rates follows a recent sharp upward move in the 10-year Treasury yield, which climbed above 4% last week for the first time since early March. The yield, which lenders used to price rates on mortgages and other loans, was down to 3.80% in midday trading Thursday following new data pointing to cooler inflation, which led bond traders to trim bets for more rate hikes by the Federal Reserve later this year.
On Wednesday, the U.S. government reported that inflation at the consumer level rose 3% in June from a year earlier, marking its lowest point since early 2021, though it remains above the Fed's 2% target.
“Incoming data suggest that inflation is softening, falling to its lowest annual rate in more than two years,” said Sam Khater, Freddie Mac’s chief economist.
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