The average rate on the 30-year fixed mortgage has risen to 7.72%, the highest since the end of 2000. This increase is directly linked to the climbing yield on the 10-year Treasury, which has been driven by strong economic data. At the beginning of the year, the rate dropped to around 6%, stimulating activity in the spring housing market. However, it has been steadily rising again over the summer, causing sales to drop despite high demand. The Federal Reserve has not raised interest rates yet, but they have hinted at the possibility of another hike this year and fewer cuts than expected next year. Higher mortgage rates have greatly impacted affordability and have become a major concern for both the new and existing-home sales markets. Builder sentiment has declined into negative territory for the first time in five months.
This rise in mortgage rates is attributed to the increase in the yield on the 10-year Treasury, which follows strong economic data. The rate on the 30-year fixed mortgage has reached 7.72%, the highest since 2000. This year, the rate briefly dropped to 6%, which resulted in increased activity in the spring housing market. However, the rate has been steadily increasing again throughout the summer, leading to a decline in sales despite high demand. The Federal Reserve has signaled the possibility of another interest rate hike this year and fewer rate cuts than initially expected next year. This trend of higher rates has had a significant impact on affordability and has become a major concern in both the new and existing-home sales markets. Builder sentiment has even fallen into negative territory for the first time in five months.
The rise in mortgage rates can be attributed to the climbing yield on the 10-year Treasury, influenced by robust economic data. Currently, the average rate on the 30-year fixed mortgage stands at 7.72%, the highest it has been since the end of 2000. Earlier this year, the rate briefly plummeted to around 6%, leading to an increase in activity in the spring housing market. However, it has been steadily rising again throughout the summer, resulting in a decline in sales despite the presence of strong demand. The Federal Reserve has refrained from raising interest rates thus far, but they have indicated the possibility of another hike later this year and fewer cuts than originally anticipated for next year. This surge in rates has had a significant impact on affordability, posing a major concern for both the new and existing-home sales markets. As a result, builder sentiment has slipped into negative territory for the first time in five months.
