US mortgage rates hit 16-year high | FOX 4 Kansas City WDAF-TV

Mortgage rates reached a 16-year high last week, further dampening demand from home buyers, according to data from the Mortgage Bankers Association (MBA) released on Wednesday.

The 30-year fixed mortgage rate rose to 6.75 percent in the last week of September, the highest rate since 2006. Mortgage rates have risen a whopping 1.3 percentage points over seven straight weeks of increase.

Mortgage applications fell 14.2 percent from a week earlier, according to the MBA, amid rising mortgage rates, stemming from the Federal Reserve’s persistent rate hikes aimed at fighting inflation.

“Harmful rate hikes continue to dampen refinancing activity and also affect purchase applications, which have dropped 37 percent from last year’s pace,” Joel Kan, MBA’s associate vice president of economic and industry forecasting, said in a statement.

“There is also the impact of the arrival of Hurricane Ian in Florida last week, which led to closures and evacuations,” he added.

Mortgage rates have more than doubled over the last year, making monthly payments much more expensive.

Sky-high rates, combined with near-record house prices, are scaring would-be buyers away from the housing market. Home sales are slowing across much of the US after a prolonged housing boom during the pandemic. Analysts expect prices to dive in the coming months.

Federal Reserve Chairman Jerome Powell recently told reporters the US housing market will likely “have to go through a correction” to bring prices down to attainable levels.

Leave a Reply

Your email address will not be published. Required fields are marked *