Dramatic climb in US mortgage rates continues

Average 30-year fixed-rate mortgage hits new high

Dramatic climb in US mortgage rates continues

US mortgage rates were on an upward trajectory for the seventh consecutive week, shooting dangerously close to 8%, according to Freddie Mac’s Primary Mortgage Market Survey (PMMS).

“For the seventh week in a row, mortgage rates continued to climb toward 8%, resulting in the longest consecutive rise since the Spring of 2022,” said Freddie Mac chief economist Sam Khater. “Rates have risen two full percentage points in 2023 alone.”

As of October 26, the 30-year fixed-rate mortgage averaged 7.79%, a rise from the previous week’s average of 7.63%. This rate was significantly higher compared to the same period last year when it was 7.08%.

Freddie Mac’s PMMS report also showed an 11-basis-point increase in the average 15-year fixed-rate mortgage, up to 7.03% from last week. This time last year, the 15-year FRM was at 6.36%.

Joel Kan, deputy chief economist of the Mortgage Bankers Association, commented on the trend, linking it to the rise in Treasury yields.

“Ten-year Treasury yields climbed higher last week, as global investors remained concerned about the prospect for higher-for-longer rates and burgeoning fiscal deficits,” Kan said. “Rates have now risen seven consecutive weeks at a cumulative amount of 69 basis points.”

“As we head into Halloween, the impacts may scare potential homebuyers,” Khater added. “Purchase activity has slowed to a virtual standstill, affordability remains a significant hurdle for many, and the only way to address it is lower rates and greater inventory.”

Weekly mortgage applications dipped to their slowest pace since 1995, according to the MBA. Overall application activity was down 1%, with purchase applications down 2%. Refinance activity, however, increased 2%.

Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.