Average U.S. mortgage rates rise; 30-year loan breaches 4%

By AP News

Share:

WASHINGTON (AP) — Average long-term U.S. mortgage rates rose this week as the key 30-year loan vaulted over 4% for the first time since May 2019.

WASHINGTON (AP) — Average long-term U.S. mortgage rates rose this week as the key 30-year loan vaulted over 4% for the first time since May 2019.

The increase came amid expectations that with inflation at a four-decade high, the Federal Reserve would raise its benchmark short-term interest rate at its policy meeting this week to cool the economy. That action came Wednesday, as the Fed increased the key rate — which it had kept near zero since the pandemic recession struck two years ago — by a quarter point. And the central bank signaled potentially up to seven additional rate hikes this year.

The increases mean that mortgage rates likely will continue to rise over the year.

Mortgage buyer Freddie Mac reported Thursday that the average rate on the 30-year loan this week jumped to 4.16% from 3.85% last week. That’s a sharp contrast from last year’s record-low mortgage rates of under 3%. A year ago, the 30-year rate stood at 3.09%.

The average rate on 15-year, fixed-rate mortgages, popular among those refinancing their homes, climbed to 3.39% from 3.09% last week.

Home prices are up about 15% over the past year and as much as 30% in some cities. Homes available for sale have been in short supply even before the pandemic started two years ago. Now higher prices and rising loan rates will make it even harder for would-be buyers heading into the spring homebuying season.

The government reported Tuesday that wholesale inflation in the U.S. shot up 10% last month from a year earlier — another sign that inflationary pressures remain intense at all levels of the economy. The report didn’t include price changes after Feb. 15, missing a spike in energy prices when Russia invaded Ukraine nine days later.

Share:

In this article:

Industries:
Financials

Author: AP News

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

Originally published by Associated Press Valuethemarkets.com, Digitonic Ltd (and our owners, directors, officers, managers, employees, affiliates, agents and assigns) are not responsible for the content or accuracy of this article. The information included in this article is based solely on information provided by the company or companies mentioned above.

Sign up for VTM Updates

Form submitted successfully!

Top Picks for Q2 2022

View More

Crypto Corner

Learn your NFTs from your BTCs