Mortgage Rates Rise For 3rd Straight Week

Mortgage rates continue to climb, increasing for the third straight week and reaching a level not seen since November, Freddie Mac said Thursday.

The 30-year fixed-rate mortgage (FRM) increased 18 basis points to 6.5%, according to Freddie Mac’s Primary Mortgage Market Survey (PMMS).

“The economy continues to show strength, and interest rates are repricing to account for the stronger-than-expected growth, tight labor market, and the threat of sticky inflation,” said Sam Khater, Freddie Mac’s chief economist. "Our research shows that rate dispersion increases as mortgage rates trend up. This means homebuyers can potentially save $600 to $1,200 annually by taking the time to shop among lenders to find a better rate.”

Mortgage Rates:

• 30-year fixed-rate mortgage averaged 6.5% as of Feb. 23, up from 6.32% last week. A year ago, it averaged 3.89%.
• 15-year fixed-rate mortgage averaged 5.76%, up from 5.51% last week. A year ago, it averaged 3.14%.

The PMMS is focused on conventional, conforming, fully amortizing home purchase loans for borrowers who put 20% down and have excellent credit. 

Jiayi Xu, economist for Realtor.com, said the increase in mortgage rates followed the increase in the 10-year Treasury. She also said the mixed signals in the economy and uncertainty over what the Federal Reserve will do at its March meeting is causing many companies to tighten their belts in preparation for a potential economic downturn.

“This means that the housing market will continue to be a ‘nobody’s market’ – not friendly to buyers nor to sellers,” Xu said. “Mortgage rates are likely to move in the 6% to 7% range over the next few weeks, which continues to pose a significant challenge to affordability.”