Mortgage rates, home prices on the rise

World events are conspiring to make it more expensive for you to borrow money to buy a house.

Mortgage rates have increased for five consecutive weeks, according to Bankrate data, bringing interest on a 30-year fixed rate loan to 4.44 percent, the highest level in 11 months, while home prices continue to rise due to a lack of available homes.

After years of tepid economic growth, animal spirits are aflame. Inflation and wage growth recently found a groove, while the Federal Reserve’s plan to raise short-term interest rates multiple times for a consecutive year has reduced the value of government debt. The yield on 10-year Treasuries is close to a fouryear high. (Bond prices and yields are inversely related.)

Oh, and China may reduce its appetite for U.S. bonds.

Mortgage rates are moved by the yield on 10-year Treasuries, rather than shortterm rate hikes by the Fed. That’s why mortgage rates fell throughout 2017, for instance, even as the central bank raised the federal funds rate three times.

Rates remain cheap, however, compared to historical prices. A 30-year fixed-rate mortgage came with an interest rate above 6 percent just before the Great Reces- sion in 2007.

Potential homeowners should get off the fence and make a bid, assuming you have an affordable home target and adequate savings, because rates are likely only heading north.