After the Federal Reserve raised its key short-term benchmark rate by another three-quarters of a percentage point on Wednesday, the average for the 30-year fixed-rate mortgage climbed to its highest level in 14 years, remaining above 6% and hitting more home buyers’ pocketbooks. It’s the fifth time this year the Fed has taken aggressive action to try to tame 40-year-high inflation.
While mortgage rates are not directly tied to the Fed’s fund rate, the Fed’s action does often trickle down in some ways to rates. Mortgage rates are more closely connected to 10-year Treasury yields, which surged to their highest level since 2011, Freddie Mac reports. That has prompted mortgage rates to double or more their levels of a year ago.
Freddie Mac reports the following national averages with mortgage rates for the week ending Sept. 22:
*30-year fixed-rate mortgages: averaged 6.29%, with an average 0.9 point, up from 6.02% last week. Last year at this time, they averaged 2.88%.
*15-year fixed-rate mortgages: averaged 5.44%, with an average 1 point, rising from last week’s 5.21% average. A year ago, they averaged 2.15%.
Source: https://lnkd.in/gH2jzUXK and Melissa Dittmann Tracey