As Mortgage Rates Surge Higher, These Home Buyers Are Being Pushed Out of the Market
April 08, 2022
By Jacob Passy
Apr 8, 2022
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The steep upward climb in mortgage rates still isn’t showing any signs of stopping.
The average rate on a 30-year fixed-rate mortgage was 4.72% as of the week ending April 7, Freddie Mac reported Thursday, up from 4.67% a week earlier. The last time the interest rates on home loans were this high was in the fall of 2018.
This is the sixth consecutive week in which mortgage rates have increased. And over the past three months, they have risen 1.5 percentage points. This represents the fastest three-month increase in rates since 1994, Freddie Mac chief economist Sam Khater said in the report.
“The increase in mortgage rates has softened purchase activity such that the monthly payment for those looking to buy a home has risen by at least 20% from a year ago,” he added.
The 15-year fixed-rate mortgage is currently sitting at an average of 3.91%, according to Freddie Mac’s latest data, up eight basis points from a week ago. A basis point is equal to one hundredth of a percent, or 1% of 1%. The 5-year Treasury-indexed hybrid adjustable-rate mortgage average was 3.56% for the most recent week, up six basis points from the week before.
Overall, the surge in mortgage rates is beginning to encroach on home-buying demand. Mortgage application data shows that applications for loans used to purchase homes are down 9% from a year ago, according to the most recent numbers from the Mortgage Bankers Association.
