US mortgage rates rose for a second straight week, reaching the highest since November.
(Bloomberg) — US mortgage rates rose for a second straight week, reaching the highest since November.
The average for a 30-year, fixed loan increased to 6.81% from 6.71% last week, Freddie Mac said in a statement Thursday.
Mortgage rates are inching closer to 7%, a level not crossed since late 2022. Higher borrowing costs have ratcheted up pressure on buyers, squeezing affordability. House hunters are also facing a shortage of listings as many current owners are reluctant to give up lower mortgage rates.
“These high rates combined with low inventory continue to price many potential homebuyers out of the market,” Sam Khater, Freddie Mac’s chief economist, said in the statement.
The tight housing market is helping drive prices higher, with the average US home selling for more than its asking price for the first time in nearly a year, according to Redfin Corp. data for the four weeks ending July 2.
While Federal Reserve officials voted unanimously last month to hold rates steady, some policymakers would have supported an increase, according to minutes released Wednesday that affirmed the central bank’s desire to bring inflation back to its target range, according to Realtor.com economist Jiayi Xu.
“While this may put near-term upward pressure on interest rates, including mortgage rates, we anticipate a gradual decrease that could bring rates close to 6% by the end of the year,” Xu said.
At the current 30-year average, monthly payments for a $600,000 loan would be $3,916. That’s about $1,314 more than at the start of last year, when rates were closer to 3%.
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