Mortgage rates hit 6%, first time since 2008

WASHINGTON — Average long-term U.S. mortgage rates climbed over 6% this week for the first time since the housing crash of 2008, threatening to sideline even more homebuyers from a rapidly cooling housing market.

Mortgage buyer Freddie Mac reported Thursday that the 30-year rate rose to 6.02% from 5.89% last week. The long-term average rate has more than doubled since a year ago and is the highest it’s been since November of 2008, just after the housing market collapse triggered the Great Recession. One year ago, the rate stood at 2.86%.

Rising interest rates — in part a result of the Federal Reserve’s aggressive push to tamp down inflation — have cooled off a housing market that has been hot for years. Many potential home buyers are getting pushed out of the market as the higher rates have added hundreds of dollars to monthly mortgage payments. Sales of existing homes in the U.S. have fallen for six straight months, according to the National Association of Realtors.

The average rate on 15-year, fixed-rate mortgages, popular among those looking to refinance their homes, rose to 5.21% from 5.16% last week. Last year at this time the rate was 2.19%.

Mortgage rates don’t necessarily mirror the Fed’s rate increases, but tend to track the yield on the 10-year Treasury note. That’s influenced by a variety of factors, including investors’ expectations for future inflation and global demand for U.S. Treasurys.

Recently, faster inflation and strong U.S. economic growth have sent the 10-year Treasury rate up sharply, to 3.45%.

The Fed has raised its benchmark short-term interest rate four times this year.