Mortgage rates reached their highest level in 17 years when located at 6.75% . Rates accumulate their seventh consecutive weekly increase in the United States at the same time that the Federal Reserve intensifies its fight against inflation.
Data from the Mortgage Bankers Association (MBA) show that the contract rate of a fixed mortgage at 30 years rose almost a quarter of a percentage point in the last week of September. This meant a drop of more than 14% in requests to buy or refinance a house.
In the last seven weeks, mortgage rates have skyrocketed 1.54%. It is the largest increase in a comparable period since 2003 and reflects the spiraling rise in borrowing costs as the Fed steps up its monetary policies, when raising the base interest rate by 0.75% in its last meeting.
On the other hand, the rate of MBA applications to buy a house slumped from 12.6% to 174.11 points, the lowest level since 2015. The refinancing indicator fell 17.8% to a minimum of 22 years.
Other measures of mortgage rates such as Freddie Mac’s also place the cost of loans at 29 years at 6.7%, the highest since 2007, in the week ending 29 in September.
Mortgage News Daily, which is updated more frequently, placed the mortgage rate at 30 years at 6.65% on Tuesday 4th of October.
The increase in mortgage rates has been vertiginous. In the week ending September 9, the cost of loans had reached 6.04% from the 5.94% you registered the previous week. At that time that level had not been seen in 14 years.
High borrowing costs that strain long-term budgets, plus high prices related to low inventory and tight ability to afford a down payment have left Latinos out of the real estate market.
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