Mortgage rates have risen to their highest level in more than 14 years, since the 2008-09 the financial crisis, adding pressure to housing market in the United States.
According to the survey of lenders, the average rate on a 30-year fixed mortgage has risen to 6.7%. It was the highest rate since June, 2007.
Mortgage rates have risen as a result of the Federal Reserve’s interest-rate hikes. The central bank has raised its benchmark rate five times this year in an attempt to cool the highest inflation in decades. More increases are expected in the coming months, according to officials.
Due to the enormous impact they have on a buyer’s monthly payment, interest rates have a huge impact on the housing market.
Because interest rates have risen so dramatically this year, some would-be purchasers have given up and opted to continue renting. Others are spending far more than they intended on their monthly payments. Some current homeowners are hesitant to sell since doing so would entail taking out a new mortgage with a much higher interest rate.
Also, existing-home sales had fallen for the seventh month in a row. Year over year, home prices continue to rise, but the rate of growth has slowed, and prices are beginning to fall month over month.
Higher interest rates have also made refinancing less appealing.
According to figures provided by the Mortgage Bankers Association, refinancing applications are down over 82% from a year ago.
