Average long-term mortgage rate rises for 7th straight week
for new loans dipped to the slowest weekly pace since NEW YORK — The aver- 1995. Meanwhile, the share age rate on the benchmark of applications for adjust30-year home loan rose for able rate mortgages rose the seventh straight week, to 9.5%, the higher since creating an increasingly high November. bar to home ownership for The soaring cost of borAmericans. rowing money for a home
The rate on the 30-year has skewed the U.S. housfixed mortgage is at 7.79%, ing market. up from 7.63% last week, Millions of people who Freddie Mac said Thurs- locked in mortgages at this day. A year ago the rate was time two years ago at 3% or 7.08%. below cannot afford to, or
As mortgage rates rise, refuse to move, due to the they can add hundreds of comparative cost of financdollars a month in costs for ing a home today. borrowers, limiting how Last week, the National much they can afford in a Association of Realtors market already out of reach reported that sales of for many Americans. They existing homes not only also discourage homeown- fell for the fourth consecers who locked in far low utive month, but the pace rates two years ago, when of sales has ground to the they were around 3%, from slowest pace in more than selling. decade.
The national median At the same time, the pace mortgage payment was of new home sales continue $2,155 in September, up to astound economists for 11%, or $214, from a year the opposite reason. ago, according to the MortNew home sales in last gage Bankers Association. month jumped to 759,000,
Sales of previously occu- about 79,000 more than pied U.S. homes in Septem- had been expected with ber fell for the fourth month prospective buyer floodin a row, grinding to their ing the only market where slowest pace in more than homes are available - those decade. that were just built.
The rate on the 15-year “Homebuilders are offerloan rose to 7.03% from ing buyers interest rate buy6.92%. A year ago the rate down incentives that funnel on the loan, which is popu- demand into the newly-built lar with homeowners their segment,” said Bill Adams, home loan, was at 6.36%. chief economist at Comer
“Purchase activity has ica. “They are also shrinking slowed to a virtual stand- floorplans to boost affordstill, affordability remains a ability.” significant hurdle for many Adams says home buildand the only way to address ers are the “surprise winit is lower rates and greater ner” of attempts by the Fedinventory,” said Freddie eral Reserve to cool inflation Mac chief economist Sam through interest rate hikes. Khater. Mortgage rates have
The high rates are limiting been climbing along with applications for new mort- the 10-year Treasury yield, gages. Wednesday the MBA which lenders use as a guide reported that applications to pricing loans.
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