Mortgage rates rising
Donald Trump’s presidential victory is already having a big impact on one part of the economy—housing.
Mortgage rates jumped over the past two weeks. Interest for the average 30-year fixed-rate mortgage was 3.47 percent at the end of October, according to Freddie Mac, the government-backed purchaser of home loans. That average has climbed above 4 percent.
That increase matters a lot for monthly payments.
At current rates, it would cost roughly $830 a month to pay the principle and interest on a $220,000 home. The rising rates have caused the payment to go up by $43 a month since late October.
Some homebuyers can likely find a way to spare an additional $516 a year on their mortgages, so sales shouldn’t be disrupted much, according to many real estate experts. Rates are now roughly where they were at the start of 2016.
Mortgage rates have increased along with 10-year Treasury notes. Investors anticipate that the Trump administration will run a higher budget deficit, prompting a rise in inflation and higher rates.