{"id":49649,"date":"2023-08-17T12:36:42","date_gmt":"2023-08-17T16:36:42","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/mortgage-rates-hit-7-09-the-highest-in-more-than-two-decades\/"},"modified":"2023-08-17T12:36:44","modified_gmt":"2023-08-17T16:36:44","slug":"mortgage-rates-hit-7-09-the-highest-in-more-than-two-decades","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=49649","title":{"rendered":"Mortgage Rates Hit 7.09%, the Highest in More Than Two Decades"},"content":{"rendered":"
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The average 30-year mortgage rate rose above 7% to its highest level in more than two decades, adding to housing costs as buyers compete over a limited number of properties for sale.\u00a0<\/p>\n

The average 30-year fixed-rate mortgage was 7.09% as of Thursday,
\n Freddie Mac
\n said today. It was the highest rate measured by the weekly gauge since April 2002, when it was at 7.13%. It\u2019s the first time since last November that rates exceeded 7%, when rates topped out at 7.08%.<\/p>\n

\n

The jump above 7% in the often-referenced mortgage rate gauge follows a runup in Treasury yields earlier this week as markets expected longer-lasting action by the Federal Reserve to tame inflation, Barron\u2019s<\/em>\u00a0previously reported.\u00a0<\/strong><\/p>\n

\u201cThe economy continues to do better than expected and the 10-year Treasury yield has moved up, causing mortgage rates to climb,\u201d Freddie Mac chief economist Sam Khater said in a statement. \u201cDemand has been impacted by affordability headwinds, but low inventory remains the root cause of stalling home sales.\u201d<\/p>\n

The 10-year yield on Thursday morning had climbed to 4.301%, its highest level on a preliminary basis since November 2007, according to Dow Jones Market Data. Because of the time period through which Freddie Mac collects its mortgage rate data, the impact of Thursday\u2019s gain in Treasury yields on mortgage rates will be reflected in next week\u2019s data.\u00a0<\/p>\n

The rise in mortgage rates rates comes as the past year\u2019s erosion in affordability is again a topic of conversation. Two National Association of Realtors indices measuring the cost of buying a home relative to income, both for first-time buyers and those more broadly, reached their lowest points in the second quarter since the trade group began collecting such data in 1989. <\/p>\n

For buyers with a low down payment, the monthly costs associated with buying a home are now higher than the cost of renting one, according to Zillow data.<\/p>\n

In a note earlier this week, a team of Goldman Sachs analysts upwardly revised its home price forecasts. They now call for a slight gain this year instead of the previously forecast loss. The team cited a tight supply of existing homes and stronger-than-expected demand from buyers. <\/p>\n

\u201cHomebuyers have demonstrated behavior that, in our view, reflects unsustainable adaptations to elevated mortgage rates,\u201d they wrote. \u201cFor example, the average debt-to-income ratio on conforming purchase mortgages is over 38%, a significant aberration from post-global financial crisis averages.\u201d<\/p>\n

Applications for home loans last week were about flat with the week prior, at a level roughly 3% above their all-time low, according to Mortgage Bankers Association data. <\/p>\n

\u201cThese higher rates continue to keep many prospective buyers on the sidelines,\u201d Mortgage Bankers Association president and CEO Bob Broeksmit said in a Thursday statement. \u201cOn the bright side, we have seen a slight uptick in government purchase applications as well demand for ARM products, which could indicate that some buyers remain active in their homebuying search despite higher rates.\u201d<\/p>\n

The impact of higher rates on builders and new home sales is yet to be seen. Builder confidence fell this month after seven consecutive months of increases, the National Association of Home Builders said earlier this week. Still, single-family starts, a measure of new home construction, rose from the month prior in July<\/strong>. <\/p>\n

The next read on the health of the housing market will come next week. On Tuesday, the National Association of Realtors will release its existing-home sales data for July. Economists expect that previously owned homes were sold at a seasonally-adjusted annual rate of 4.1 million in July, down from 4.16 million one month prior, according to FactSet. <\/p>\n

Sales of new homes, expected Wednesday, are also expected to have dropped: economists expect the census\u2019s count of contract signings for new single-family home purchases to fall to 655,000 from 697,000 in June. <\/p>\n

Write to Shaina Mishkin at shaina.mishkin@dowjones.com<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

The average 30-year mortgage rate rose above 7% to its highest level in more than two decades, adding to housing costs as buyers compete over a limited number of properties for sale.\u00a0 The average 30-year fixed-rate mortgage was 7.09% as of Thursday, Freddie Mac said today. It was the highest rate measured by the weekly […]<\/p>\n","protected":false},"author":1,"featured_media":49650,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-49649","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-markets","tag-featured","post_format-post-format-gallery"],"yoast_head":"\nMortgage Rates Hit 7.09%, the Highest in More Than Two Decades | iFintechWorld<\/title>\n<meta name=\"description\" content=\"The average 30-year mortgage rate rose above 7% to its highest level in more than two decades, adding to housing costs as buyers compete over a limited\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ifintechworld.com\/?p=49649\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta 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