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Mortgage interest rates soar as inflation pressure increases

The benchmark interest rate on home loans has rebounded above 3% as inflation-related concerns prevail.

30-year fixed-rate mortgages averaged 3.1% in the week ended Nov. 18, up 12 basis points from the previous week, Freddie Mac
FMCC,

Thursday’s reporty.

The 15-year fixed-rate mortgage also increased 12 basis points to an average of 2.39%. The 5-year adjustable-rate mortgage averaged 2.49% by the Treasury, down 4 basis points from last week.

“The combination of rising inflation and consumer spending is driving mortgage rates higher,” said Freddie Mac chief economist Sam Khater in the report.

This week’s rise could be an indication of what’s to come on the way to resume. According to Paul Thomas, vice president of capital markets at Zillow, the most recent data on retail sales remained strong despite the record price increase, which suggests the post-pandemic economic recovery continues to have an impact. motivation.
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-4.66%

ZG,
-5.08%
.

“If the economic recovery holds, this continued inflationary trend could increase the likelihood that the Federal Reserve will conduct some rate hikes in 2022,” Thomas said, adding that in Short-term supply chain-related issues could put pressure on interest rates.

For homebuyers, the hike in mortgage rates comes at a time when home prices continue to rise at a steady rate. But the relief may be in sight.

Survey data from Realtor.com shows that the percentage of existing homeowners planning to sell their homes next year jumped from 10% this spring to 26% this fall. If these homeowners execute on their plans, that could increase the supply to the housing market. At that time, buyers will have more options and the rate of home price growth may slow down a bit

“We’ve seen an increase in new listings over the past two weeks and that has helped keep the pace of price growth in check,” said George Ratiu, director of economic research at Realtor.com. “. “However, demand from buyers continues to be strong, causing inventories to continue to move rapidly, especially for well-priced homes.”

https://www.marketwatch.com/story/mortgage-rates-surge-higher-as-inflationary-pressures-grow-11637248497?rss=1&siteid=rss Mortgage interest rates soar as inflation pressure increases

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