The national housing market continues to fling home-opportunity buyers, now with a new record in the average interest rate for 30-year fixed-rate mortgages. The data as of September 9 last reached 6.01%, according to the Mortgage Bankers Association (MBA)
The mortgage market continues to test buyers who still dare to look for an opportunity to buy a home, now with a new increase to 6% in the interest rate for 30-year fixed mortgages.
The interest rate for this type of mortgage, the most common among buyers, had not reached this level for 14 years, according to reports from the Mortgage Bankers Association’s (MBA) Weekly Survey of Mortgage Applications.
According to the report, the interest rate for fixed-rate mortgages climbed to 6.01% in the week ending September 9 last; from 5.94% that reached a previous week, which ended on September 2.
According to historical data from the MBA, the interest rate for this type of mortgage loan had not reached 6% since 2008.
“It’s basically double what it was a year ago,” Joel Kan, MBA’s associate vice president for economic and industrial forecasting, explained in a press release.
Housing remains a challenge for Americans not only because of skyrocketing mortgage rates, but also soaring home prices, which are not expected to go down before 2023.
According to the latest report from the Bureau of Labor Statistics, along with food and medical care, housing was one of the three products and services that most raised inflation last August, which reached 8.3%.
In monthly terms, house prices rose 0.7% in August, a figure that was higher than the 0.5% of the previous July; however, in its annual comparison, housing prices had an increase of 6.2%, the highest figure since February 1991.
Buyers walk away from the market
High house prices and unyielding interest rates are driving more and more buyers out of a market that they say is entering what has been called a housing recession.
According to the MBA report, the number of mortgage loans fell 1.2% during the week ending September 9, compared to the previous week’s index.
Meanwhile, the report abounded that the refinancing index also had a 4% drop, according to the MBA report.
Mortgage rates rose sharply once the Federal Reserve began to increase its base interest rate, as a measure to control inflation.