Mortgage rates climbed higher this week, reaching its fourth highest level of 2018, according to Freddie Mac’s latest Primary Mortgage Market survey.
“The higher rate environment, coupled with the ongoing lack of affordable inventory, has led to a drag on existing-home sales in the last few months,” Freddie Mac Chief Economist Sam Khater said. “Yesterday, the Federal Reserve passed on raising short-term rates, but with the embers of a strong economy potentially stoking higher inflation, borrowing costs will likely modestly rise in coming months.”
“Even with home price growth easing slightly in some markets, mortgage rates hovering near a seven-year high will certainly create affordability challenges for some prospective buyers looking to close.”
According to the most recent Case-Shiller report, home prices are reported to be rising at two to three times the rate of inflation.
(Source: Freddie Mac)
According to the report, the 30-year fixed-rate mortgage averaged 4.60% for the week ending August 2, 2018, up from 4.54% last week, and up from 3.93% last year.
The 15-year FRM inched forward to an average 4.08 this week, up from last week when it averaged 4.2%. This time last year, the 15-year FRM was 3.18%.
The five-year Treasury-indexed hybrid adjustable-rate mortgage inched forward this week at 3.93%, which is still up from this time last year when it was 3.15%.