Mortgage rates are currently decreasing, falling in four of the past five weeks, and yet new borrowers are still paying significantly more on their mortgages than those who bought a home this time last year.

The latest Primary Mortgage Market survey from Freddie Mac showed the 30-year fixed rate mortgage decreased to 4.55% this week. And while this is down a couple basis points from last week, it is up significantly from 3.88% last year.

And not only do mortgage rates remain significantly higher than last year’s levels, but home prices are up about 9% from last year as well.

These two factors combined pushed monthly payments for principal and interest along up 18% year-over-year on the typical home listing, according to Chief Economist Danielle Hale.

But rising threats of a trade war could keep rates from moving too much higher in the near future.

“While a strong economy and Fed moves in short-term rates should push rates higher, the possibility of a trade war has helped keep longer-term bond rates from advancing,” Hale said. “After nearing 3% just two weeks ago, 10-year treasury rates finished yesterday 15 basis points lower at 2.83%.”

“This has helped keep mortgage rates, which are more closely aligned to longer-term 10-year rates, roughly steady,” she said.

But at this point, the future remains uncertain. Hale explained continued strength in the U.S. economy such as a strong jobs report next week could begin to push mortgage rates up once again.

However, one report shows about 100,000 Americans are at risk of losing their jobs due to the administration’s trade war.

What happens over the next few weeks is anyone’s guess, but most experts are predicting interest rates will hit 5% by the end of 2018 or beginning of 2019.

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