Mortgage rates rose again over the past week, reaching 3.14%, Freddie Mac reported Thursday.
Freddie’s Primary Mortgage Market Survey (PMMS) found that the 30-year fixed-rate mortgage (FRM) averaged 3.14%, up from last week’s 3.09%. A year ago at this time, the 30-year FRM averaged 2.81%
“The yield on the 10-year Treasury note has been trending up due to the decline in new COVID cases, increasing consumer optimism, as well as broadening inflation and persistent shortages,” said Sam Khater, Freddie Mac’s Chief Economist.
“Mortgage rates are also rising, but purchase demand remains firm, showing that latent purchase demand exists among consumers.”
Industry experts have noted minor decreases in home prices and other factors that would point to a cool-down, but the market remains hot. The pace of home sales has risen recently, despite the fact that fall is usually a period of slowdowns in sales. One-third of homes that sold in the past four weeks went under contract within seven days of hitting the market.
“Homes continue to sell quicker and quicker,” said Redfin Chief Economist Daryl Fairweather. “There are still plenty of homebuyers lying in wait who missed out during the Spring frenzy, and they are snatching up homes quickly. Now, those homes are selling for near-record prices. The housing market will likely stay hot until mortgage rates rise substantially.”
Inflation is a growing concern across the economy. The Labor Department’s Consumer Price Index jumped 5.4% in September from a year earlier, a 13-year high.
Additional findings from Thursday’s report:
- 15-year fixed-rate mortgage averaged 2.37% with an average 0.7 point, up from last week when it averaged 2.33%.
- A year ago at this time, the 15-year FRM averaged 2.32%.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.56% with an average 0.3 point, up from last week when it averaged 2.54%.
- A year ago at this time, the 5-year ARM averaged 2.88%