U.S. mortgage rates rose for the seventh week in a row, making it the longest streak of increases since last spring.
The 30-year fixed-rate mortgage averaged 7.79% as of October 26, according to data released by Freddie Mac
FMCC,
-3.95%
on Thursday.
It’s up 16 basis points from the previous week — one basis point is equal to one hundredth of a percentage point. Rates continue to be at the highest level since November 2000.
A year ago, the 30-year was averaging at 7.08%.
The average rate on the 15-year mortgage was 7.03%, up from 6.92% last week. The 15-year was at 6.36% a year ago.
Freddie Mac’s weekly report on mortgage rates is based on thousands of applications received from lenders across the country that are submitted to Freddie Mac when a borrower applies for a mortgage.
Separate data by Mortgage News Daily said that the 30-year fixed-rate mortgage was averaging at 7.98% as of Thursday afternoon.
What Freddie Mac said: “Rates have risen two full percentage points in 2023 alone and, as we head into Halloween, the impacts may scare potential homebuyers,” Sam Khater, chief economist at Freddie Mac, said in a statement.
“Purchase activity has slowed to a virtual standstill, affordability remains a significant hurdle for many and the only way to address it is lower rates and greater inventory,” he added.
What are they saying? “In March 2022, the typical monthly payment was about $2,000 and home buyers needed an income of about $89,000 to qualify for a loan. Now … the typical monthly payment is $3,100 and a homebuyer would have to earn more than $130,000 to qualify,” Lisa Sturtevant, chief economist at Bright MLS, said in a statement.
“For some prospective home buyers, the numbers simply don’t pencil with rates near 8%. For others, the reaction will be more psychological than financial,” she added. “Mortgage rates are likely to remain well into the 6’s through next year and home prices will continue to be propped up by very tight supply.”
Read the full article here