Mortgage Rates Sees Largest One-Week Spike Since 1987

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According to data released by Freddie Mac Thursday, the 30-year fixed-rate mortgage averaged 5.78 percent.

Freddie Mac released the results of its Primary Mortgage Market Survey, with its Chief Economist, Sam Khater, stating Mortgage rates surged as the 30-year fixed-rate mortgage moved up more than half a percentage point, marking the largest one-week increase in our survey since 1987.”

“These higher rates are the result of a shift in expectations about inflation and the course of monetary policy. Higher mortgage rates will lead to moderation from the blistering pace of housing activity that we have experienced coming out of the pandemic, ultimately resulting in a more balanced housing market,” added Khater.

The 15-year fixed-rate mortgage averaged 4.81%, while the 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 4.33%.

Redfin (NASDAQ:RDFN) this week announced job cuts, with demand for its services in May 17% below expectations. The company had warned of a slowdown in recent months due to rising mortgage rates. In addition, mortgage demand has fallen to its lowest level in 22 years.