Freddie Mac attributes the increase to strong business activity and employment growth
Mortgage rates rose significantly for the week ending Nov. 8, with the 30-year fixed mortgage rate surging to a seven-year high, according to the Primary Mortgage Market Survey released by Freddie Mac.
Rates for the 30-year fixed-rate mortgage averaged 4.94%, with an average 0.5 point, up from the 4.83% average in the previous period. The average rate also increased year-over-year from a 3.9% average.
The 15-year fixed-rate mortgage averaged 4.33%, with an average 0.5 point, up from 4.23%. A year ago at this time, the mortgage averaged 3.24%.
The average rate for the 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) increased to 4.14%, with an average 0.3 point, from 4.04%. The 5-year ARM averaged 3.22% in the same period in 2017.
“The economy continued to show resilience as strong business activity and growth in employment drove the 30-year fixed mortgage rate to a seven-year high of 4.94% – up 11 basis points from last week,” Freddie Mac Chief Economist Sam Khater said. “Higher mortgage rates have led to a slowdown in national home price growth, but the price deceleration has been primarily concentrated in affluent coastal markets such as California and the state of Washington. The more affordable interior markets – which have not yet experienced a slowdown home price growth – may see price growth start to moderate and affordability squeezed if mortgage rates continue to march higher.”
