After a notable increase for a few weeks, the average rate for a 30-year, fixed-rate mortgage stopped rising, remaining relatively flat for three weeks.
WASHINGTON (AP) – Average long-term U.S. mortgage rates were flat for a third straight week after rising about a half percent early in the year.
The average rate on the 30-year loan held at 3.55% from last week, mortgage buyer Freddie Mac reported Thursday. It stood at 2.73% a year ago.
The average rate on 15-year, fixed-rate mortgages, popular among those refinancing their homes, fell to 2.77% from 2.80% last week. One year ago, the rate was 2.21%.
Though they remain historically low, home loan rates have been rising to levels not seen since early 2020, when the coronavirus pandemic was breaking in the U.S.
Last week, the Fed signaled that it would begin a series of interest rate hikes in March, reversing pandemic-era policies that have fueled hiring and growth, but also adding to inflation levels not seen in some 40 years.
Earlier this month, the government reported that inflation spiked to 7% in December from a year earlier, the sharpest increase in four decades. In addition, the Labor Department reported that prices at the wholesale level surged by a record 9.7% last month from December 2020.
The Fed’s upcoming rate hike – or hikes – will likely make it more expensive to borrow for a home, car or business.
Also Thursday, the government reported that applications for unemployment benefits fell for the second week in a row after three straight weeks of increases that economists blamed on the surging omicron variant of COVID-19.
The Commerce Department reported last week that the nation’s gross domestic product – its total output of goods and services – expanded 5.7% in 2021, the strongest calendar-year growth since a 7.2% surge in 1984. In the fourth quarter, the economy grew at an unexpectedly brisk 6.9% annual pace.
Available housing has been hard to come by since long before the pandemic started, and rising prices are making it even harder for homebuyers to secure a new home. Economists expect rising interest rates to add to house hunters’ dismay.
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