What You Should Know About Rising Mortgage Rates

Abstract

After steadily falling over the winter, mortgage rates have started to rise in recent weeks. This is concerning to some potential homebuyers as the combination of higher mortgage rates and higher prices have made homes less affordable. If you're planning to purchase a home this year, you too may be wondering if now's the right time to buy or if you should hold off on your search until rates come back down. The recent uptick in rates has been driven by what's happening with inflation. Joel Kan, Vice President and Deputy Chief Economist at the Mortgage Bankers Association, explains: "Mortgage rates increased across the board last week, pushed higher by market expectations that inflation will persist, thus requiring the Federal Reserve to keep monetary policy restrictive for a longer time." The most recent weekly average 30-year fixed mortgage rate reported by Freddie Mac is 6.5%. It's the third week in a row that rates have increased and puts them at the highest point they've been this year: Advice for Home Shoppers If you're thinking about pausing your home search because rates have started to go up again, you may want to reconsider. According to the MBA, mortgage applications declined by 13.3% in just one week, so it appears the rise in mortgage rates is leading some potential homebuyers to pull back on their search for a new home. Bottom Line Over the last few weeks, mortgage rates have risen.