Mortgage rates reversed their upward trend this week, averaging 5.70%, Freddie Mac reported Thursday.
Freddie’s Primary Mortgage Market Survey (PMMS) found that the 30-year fixed-rate mortgage (FRM) averaged 5.70%, down from last week’s 5.81%. A year ago at this time, the 30-year FRM averaged 2.98%.
“The rapid rise in mortgage rates has finally paused, largely due to the countervailing forces of high inflation and the increasing possibility of an economic recession,” said Sam Khater, Freddie Mac’s Chief Economist.
“This pause in rate activity should help the housing market rebalance from the breakneck growth of a seller’s market to a more normal pace of home price appreciation.”
Recession fears are rapidly growing, with 70% of economists expecting it by 2023.
“It’s perverse to say, but the Federal Reserve, by raising interest rates, is trying to slow things down by making everything more expensive. And so far, that’s working,” New York Times financial columnist and CNBC anchor Andrew Ross Sorkin said on the podcast “Sway.”
But Federal Reserve Chairman Jerome Powell said he was more concerned about high inflation continuing than about the possibility of rising interest rates causing a recession.
“Is there a risk we would go too far? Certainly there’s a risk,” Mr. Powell said this week. “The bigger mistake to make—let’s put it that way—would be to fail to restore price stability.”
Additional findings from Thursday’s report:
- 15-year fixed-rate mortgage averaged 4.83% with an average 0.9 point.
- A year ago at this time, the 15-year FRM averaged 2.26%.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.50% with an average 0.3 point.
- A year ago at this time, the 5-year ARM averaged 2.54%