Buying a home? Get ready for a 6% mortgage
Abstract
For the first time since 2008, a widely watched survey shows the average interest rate on a 30-year fixed home loan is above 6%, the latest in a series of increases that has sharply slowed the housing market. A year ago, the average rate on a 30-year fixed mortgage was 2.86%, but rates have surged this year because of inflation and the Federal Reserve's efforts to fight it. The average rate on a 15-year fixed mortgage, popular with refinancers, rose to 5.21%, up from 5.16% the previous week and 2.12% a year earlier. If rates hold here, or keep rising, it could further dampen demand and make a drop in overall home values more likely as potential homeowners find they can afford even less. Where rates head from here isn't entirely clear, however. With uncertainty surrounding those factors, rates have been volatile in recent months. Freddie Mac's survey covers mortgages for people with excellent credit who put 20% down, meaning many current home shoppers should expect higher rates than the survey average.