Mortgage rates in the United States reached a two-year high last week and are expected to continue climbing. It puts more pressure on first-time buyers who are trying to cope with soaring home costs and restricted housing availability.
The economy is continuing to normalize, according to Freddie Mac’s Chief Economist, Sam Khater. When the pandemic started, mortgage rates have soared to their top level ever.
Increases in interest rates are predicted to persist in the face of a healthy labor market and increasing inflation, which is likely to hurt consumer interest. As of February 10, the average 30-year fixed-rate mortgage rate was 3.69 %, up from 3.55% for the last week.
As the Federal Reserve boosts interest rates to battle increasing inflation, mortgage rates are anticipated to continue to rise in the coming months. After statistics released Thursday revealed that annual inflation climbed by the greatest in 40 years in January, investors are increasingly expecting the Fed to raise rates by half a percentage point next month.
According to a published article on the MSN site, in the fourth quarter of 2021, home prices continued to climb although at a slower rate. In the third quarter, the median price of a single-family house climbed by 14.6 percent over the previous year, compared to 15.9 percent in the previous year.
Mortgage rates increases
According to Lawrence Yun, the National Association of Realtors’ chief economist, the rising costs had a negative impact on house buyers. A growing number of families, particularly first-time buyers, are being pushed out of the market.
Based on Freddie Mac’s report, for February 10, 2022, the 30-year fixed-rate mortgage averaged 3.69% up from 3.55% last week. The 30-year FRM averaged 2.73% a year ago at this time.
The average 15-year fixed-rate mortgage was 2.93% up from 2.77% the previous week. The 15-year FRM averaged 2.19% a year ago at this time.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.80% up from 2.71% the previous week. The 5-year ARM averaged 2.79% a year ago at this time.