Mortgage Rates Rise Again After Recording Sharp Drop

Abstract

Mortgage rates increased for the first time in three weeks. The average rate on a 30-year fixed-rate mortgage rose to 5.51%, mortgage-finance giant Freddie Mac said Thursday. A year ago, the 30-year mortgage averaged 2.88%. Higher borrowing costs are weighing on demand for homes, slowing sales and price growth. The sharp increase in rates in the first half of the year has pushed some buyers off the market. Mortgage applications have fallen for two weeks in a row, and sales of previously owned homes have fallen for four straight months. The country's largest bank, JPMorgan Chase & Co., said Thursday that mortgage originations fell 45% in the second quarter from a year earlier. Mortgage rates are closely tied to yields on the 10-year U.S. Treasury, which fell near their lowest level in more than a month last week as investors piled into government bonds.