Freddie Mac’s Primary Mortgage Market Survey shows 30-year fixed-rate mortgages once again climbing. They are up 0.25% to 4.67%. Year-over-year, the rate increase is almost 1.5%. The rate for 15-year fixed-rate mortgages showed a similar annual increase.
“Mortgage rates continued moving upward in the face of rapidly rising inflation as well as the prospect of strong demand for goods and ongoing supply disruptions,” said Sam Khater, Freddie Mac’s chief economist. “Purchase demand has weakened modestly, but has continued to outpace expectations. This is largely due to unmet demand from first-time homebuyers as well as a select few who had been waiting for rates to hit a cyclical low.”
The 15-year fixed-rate mortgage averaged 3.83% with an average 0.8 point, up from last week when it averaged 3.63%. A year ago at this time, the 15-year FRM averaged 2.45%.
“To put the cost of rising mortgage rates into perspective, consider that a 30-year, fixed-rate mortgage loan worth $300,000 would have cost a buyer about $1,283 a month had they received a loan with the average rate on Dec. 30, 2021 of 3.11%,” said Lending Tree senior economic analyst Jacob Channel. "At today’s average rate of 4.67%, that monthly cost would be $1,551. That’s an increase of $268 a month, $3,216 a year, and $96,480 over the lifetime of the loan."
Channel expects the 5% ceiling to be broken by 2023. “Since the start of the year, mortgage rates have risen faster than most anticipated that they would. And, unfortunately, it’s possible that they’ll rise even further and end up closer to (or even higher than) 5% by the time 2023 begins,” he said.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.5% with an average 0.3 point, up from last week when it averaged 3.36%. A year ago at this time, the 5-year ARM averaged 2.84%.
The survey is focused on conventional, conforming, fully amortizing home purchase loans for borrowers who put 20% down and have excellent credit.
