For the fifth week in a row, mortgage rates were up week-over-week which is keeping rates at levels not seen since 2008, according to the Freddie Mac weekly survey.
- The 30-year fixed jumped 27 basis points to average 6.29% for the week ending September 22nd. Rates are now up 341 basis points from the same time one year ago.
- The 15-year fixed jumped 23 basis points to average 5.44% for the weekend ending September 22nd. Rates are now up 329 basis points from the same time one year ago.
Affordability. On August 18th, the 30-year fixed was at 5.13%. Just five weeks later rates are up 116 basis points. A $400k house at 5.13% with 10% down has a payment of $1,961. Meanwhile, the same house with the same amount down has a monthly payment of $2,226 with a 6.29% rate. That’s a $265 swing in just over one month.
Down Across The Board. Sam Khater, Freddie Mac’s Chief Economist. says higher rates are continuing to push demand down but supply is still low as well. “Impacted by higher rates, house prices are softening, and home sales have decreased. However, the number of homes for sale remains well below normal levels.”
BOTTOM LINE: In the bond world things are going to get worse before they get better.