Mortgage Rates Hit 19-Month High, Stifling US Housing Market
The U.S. housing market is facing new challenges as mortgage rates have risen to just below 7%, their highest level in over 19 months.
The weekly average rate on a 30-year fixed-rate home loan has been increasing for months, with this week's climb from 6.76% last week to 6.95%.
This is the fourth consecutive week of rising mortgage rates, and experts warn that higher borrowing costs can add hundreds of dollars to borrowers' monthly payments, limiting their purchasing power.
The surge in mortgage rates is attributed to the Federal Reserve's decision to raise interest rates for the first time in over three years, aiming to combat inflation. The 10-year Treasury yield, which lenders use as a guide to pricing home loans, has also breached 5% for the first time since 2023.