Average long-term mortgage rates in the United States are at their highest in 12 years

WASHINGTON (AP) — Long-term U.S. mortgage rates rose for the seventh straight week, hitting their highest level in more than a decade.

The average rate on a 30-year mortgage rose to 5.11% from 5% last week, mortgage buyer Freddie Mac reported Thursday. The last time it was higher was in April 2010, when it reached 5.21%. In contrast, a year ago, the 30-year rate stood at 2.97%.

The average rates for the last few months represent the fastest rate of increase since 1994.

Federal Reserve officials have signaled that they will take an aggressive approach to tackling high inflation this year. In minutes from their March policy meeting released earlier this month, Fed officials said interest rate hikes of half a point, rather than traditional quarter-point increases , “could be appropriate” several times this year. The Fed raised its main borrowing rate by a quarter point in March, its first increase since late 2018.

On Wednesday, the National Association of Realtors reported that sales of previously occupied U.S. homes fell in March at the slowest pace in nearly two years as a rapid rise in mortgage rates and record prices discouraged potential buyers as the spring shopping season begins. .

Median home prices in March jumped 15% from a year ago at the same time to $375,300. This is an all-time high on data dating back to 1999, NAR said.

“While spring is typically the busiest season for buying a home, rising rates have caused some volatility in demand,” said Freddie Mac chief economist Sam Khater. “It continues to be a seller’s market, but buyers who remain interested in buying a home may find that the competition has softened moderately.”

With inflation at its highest level in four decades, rising mortgage rates, rising house prices and a tight supply of homes available for sale, home ownership has become more difficult and more expensive. , especially for first-time buyers.

Freddie Mac said the average rate on 15-year fixed-rate mortgages, popular among those refinancing their homes, rose to 4.38% from 4.17% last week. A year ago, it was 2.29%.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

Comments are closed.