Mortgage rates are continuing to trend higher this week, according to Freddie Mac. The average rate for a 30-year fixed-rate mortgage rose to 3.17% this week, up from 3.14% last week. This marks the fourth consecutive week of increases in mortgage rates.
The increase in mortgage rates is due to a variety of factors, including the improving economy and rising inflation. As the economy continues to recover from the pandemic, investors are becoming more confident in the market and are willing to take on more risk. This has caused the yield on the 10-year Treasury note to rise, which in turn has pushed up mortgage rates.
In addition, inflation has been on the rise in recent months, which has also contributed to the increase in mortgage rates. The Consumer Price Index (CPI) rose by 4.2% in April, the largest increase since 2008. This has caused investors to become more cautious, as higher inflation can lead to higher interest rates.
Despite the recent increases, mortgage rates remain near historic lows. The average rate for a 30-year fixed-rate mortgage is still below 3.5%, which is significantly lower than the 4.5% average rate seen in 2019. This means that now is still a great time to buy a home, as mortgage rates are still relatively low.
However, it is important to keep in mind that mortgage rates are likely to continue to rise in the coming weeks and months. As the economy continues to recover and inflation remains elevated, mortgage rates are likely to continue to increase. Therefore, it is important to act now if you are considering buying a home, as rates may not remain this low for much longer.
