New York October 20 2022: The average for a 30-year loan climbed to 6.94% from 6.92% last week, Freddie Mac said Thursday.
Mortgage rates, now at the highest since April 2002, have more than doubled this year. The fast ascent has quashed the pandemic housing frenzy, an intended effect of the Federal Reserve’s efforts to tame inflation. With a key gauge of consumer prices at a 40-year high, another Fed rate hike is expected next month.
Sales of previously owned US homes fell for an eighth straight month in September, highlighting how rising rates have squeezed many Americans out of the market. The plunge in demand is discouraging owners from listing their properties. Builders are starting work on fewer houses and seeing their shares tumble.
Prices are starting to come down, but that’s not yet translating into savings for buyers. The typical monthly payment on a home costing $427,000 — the median list price in September — would be roughly $200 more than in June, when prices peaked at $450,000, according to Hannah Jones, economic data analyst at Realtor.com.
Rates have been pushing toward 7% in recent weeks — a level that would force about 68% of would-be buyers to pause their home searches, according to a recent survey by Zillow.
Freddie Mac has lagged behind other measures of loan costs, such as Mortgage News Daily, which currently reports a 30-year average of 7.22%.
