01/27/2022
Rates increase again to highest point since March of 2020! 30-Year Fixed-Rate Mortgages averaged 3.56% for the week ending January 20, up .11% from 3.45% the week before. The 30-year rate has now increased .79% over the last 5 months, an average weekly increase of over .03%.
The average 15-Year Fixed-Rate saw an even larger increase than the 30-year, increasing .17% from 2.62% to 2.79%. The average 15-year rate is now higher than where the 30-year rate was just 5 months ago. This goes to show how much and how quickly rates have risen across the board.
The closely watched 10-Year Treasury Yield resumed its run higher, increasing from 1.71% to 1.83%, the highest point in just under 2 years.
What’s going on? The narrative remains the same: in response to higher than optimal inflation and optimism over the economic recovery from the Covid-19 shutdown, the Federal Reserve is expected to raise short term interest rates up 3-4 times during 2022, with the first increase projected in March.
How does this relate to the housing market? Higher rates make mortgage payments more expensive, which should cause purchase demand to decrease. This has just started to begin. However, a limited supply of homes is keeping home prices elevated.
With rates still near their historic lows, it is still a great time to either purchase or refinance! Message us today to learn more or for a free quoe! Source: Freddie Mac Primary Mortgage Survey.
