Mortgage rates have increased again as new data suggests inflation is sticking harder than previously thought.
Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage rate averaged 6.65%, up from 6.50% the week prior.
A year ago at this time, the 30-year FRM averaged 3.76%.
The 15-year fixed-rate mortgage rose from 5.76% to 5.89%. A year ago, it averaged 3.01%.
“As we started the year, the 30-year fixed-rate mortgage decreased with expectations of lower economic growth, inflation, and a loosening of monetary policy. However, given sustained economic growth and continued inflation, mortgage rates boomeranged and are inching up toward seven percent,” said Sam Khater, Freddie Mac’s Chief Economist.
“Lower mortgage rates back in January brought buyers back into…
By KIMBERLEY HAAS
After officials at the Federal Reserve raised rates by 25 basis points, Chair Jerome Powell said that the fight against inflation isn’t over and he does not see them cutting rates this year.
During a press conference on Wednesday afternoon, Powell said the disinflationary process has started in some sectors of the economy but they remain cautious.
“Certainty is just not appropriate here. Inflation, it’s just hard to forecast inflation. It may come down faster. It may take longer to come down, and yet, our job is to deliver inflation back to target and we will do that, but I think we’re going to be cautious about declaring victory and sending signals that we think that the…
The pace of home sales has declined to its slowest pace since the beginning of the pandemic, but buyers are slowly starting to search for homes again. According to a new report from Redfin, the typical home sold during the four weeks ending January 8 was on the market for 44 days, the longest period since April 2020. The slowdown resulted in the largest YOY inventory increase in Redfin’s data history. Pending home sales fell by 32% YOY to their lowest recorded level, while mortgage purchase applications dipped to their lowest point since 2014. But early signs of demand like online home searches and tour requests are increasing. Redfin’s Homebuyer Demand Index rose by 6% as buyers watch interest rates…
Minutes from the December meeting of the Federal Reserve Board and the Federal Open Market Committee were released this week, and they show Fed members still focused on fighting inflation, not lowering interest rates. (The full minutes can be found here.) “Participants generally observed that a restrictive policy stance would need to be maintained until the incoming data provided confidence that inflation was on a sustained downward path to 2%, which was likely to take some time,” according to the summary of the meeting. “In view of the persistent and unacceptably high level of inflation, several participants commented that historical experience cautioned against prematurely loosening monetary policy.” While the December rate hike of 50 basis points was smaller than the…
By KIMBERLEY HAAS With the Federal Reserve raising interest rates seven times this year – and with more rate hikes on the way in 2023 – people are wondering if their policies to cool inflation are unfairly punishing those in the housing market. The Fed’s policy-setting committee raised its benchmark rate a half-point to 4.5% this week. The goal is to reach 2% inflation by controlling monetary policy. The chair of the Federal Reserve opened his press conference on Wednesday saying that he would like to underscore for the American people that they understand the hardship that high inflation is causing. Jerome Powell said the U.S. economy has slowed significantly from last year’s rapid pace. “Recent indicators point to modest…
Mortgage loan application volume rebounded last week, breaking a weeks-long streak of declines, according to the Mortgage Bankers Association’s weekly survey. The adjusted Market Composite Index, a measure of mortgage loan application volume, increased by 3.2%. The adjusted purchase index rose by 4%, though the unadjusted purchase index decreased by 1% and was 38% lower YOY. “Mortgage rates increased slightly after a month of declines, as financial markets reacted to mixed signals regarding inflation and the Federal Reserve’s next policy moves. The 30-year fixed rate inched to 6.42%, which is still close to the lowest rate in a month,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. The Federal Reserve is expected to raise interest rates by half…
Mortgage interest rates fell again last week to 6.49%, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey found that the 30-year fixed-rate mortgage averaged 6.49%, down from 6.58% the week prior. Weeks of decline have made some analysts optimistic that rates have peaked. “We probably have seen peak mortgage rates unless there is some other major shock to the economy,” Cris deRitis, deputy chief economist at Moody’s Analytics, told NextAdvisor. The 15-year fixed-rate mortgage also fell from 5.90% to 5.76%. A year ago, it averaged 2.39%. “Mortgage rates continued to drop this week as optimism grows around the prospect that the Federal Reserve will slow its pace of rate hikes,” said Sam Khater, Freddie Mac’s Chief Economist. “Even as…
Mortgage interest rates sank to 6.60% last week, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey found that the 30-year fixed-rate mortgage averaged 6.60%, down from 7.08% the week prior. This is the largest weekly drop in 40 years. The 15-year fixed-rate mortgage also fell from 6.38% to 5.98%. A year ago, it averaged 2.39%. As a result, the typical monthly mortgage payment declined by $100, giving a typical homebuyer with a $2,500 budget $12,000 more purchasing power over the course of just one week. “Mortgage rates tumbled this week due to incoming data that suggests inflation may have peaked,” said Sam Khater, Freddie Mac’s Chief Economist. “While the decline in mortgage rates is welcome news, there is still…
Mortgage loan application volume fell another 2% last week, according to the Mortgage Bankers Association’s weekly survey. Interest rates rose to 6.81%, their highest point since 2006. The adjusted Market Composite Index, a measure of mortgage loan application volume, dropped by 2%. The adjusted purchase index fell 2%, while the unadjusted purchase index decreased 2% and was 39% lower YOY. The refinance index dropped by 2% and was 86% lower than the same time last year. Refis made up 29% of total applications. The ARM share of activity dipped slightly from last week as the 5/1 interest rate jumped 20 basis points from 5.36% to 5.56%. “The ARM share of applications remained quite high at 11.7%– just below last week’s…
Mortgage loan application volume fell last week as mortgage rates topped 6% for the first time since 2008, nearly doubling year over year. The Mortgage Bankers Association’s weekly survey shows that the adjusted Market Composite Index, a measure of mortgage loan application volume, decreased by 1.2%. The adjusted purchase index rose 0.2%, while the unadjusted purchase index dropped 12% and was 29% lower YOY. The refinance index dropped by 4% and was 83% lower than the same time last year. Refis made up 30.2% of total applications. “Higher mortgage rates have pushed refinance activity down more than 80 percent from last year and have contributed to more homebuyers staying on the sidelines. Government loans, which tend to be favored by…
