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By Alex Veiga<\/div><\/div>\n

Rates on 30-year mortgages ticked up this week, but forecasters remain optimistic they will hover around 6% by the end of the year.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n<\/div>\n

LOS ANGELES \u2014 The average long-term U.S. mortgage rate rose this week to its highest level in 10 weeks, a setback for prospective homebuyers ahead of the spring homebuying season.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

The average rate on a 30-year mortgage rose to 6.77% from 6.64% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.32%.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also rose this week, pushing the average rate to 6.12% from 5.90% last week. A year ago, it averaged 5.51%, Freddie Mac said.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

The increase in rates echoes moves in the 10-year Treasury yield, which lenders use as a guide to pricing loans. Stronger-than-expected reports on inflation, the job market and the overall economy have stoked worries among bond investors that the Federal Reserve will wait longer before it begins cutting interest rates.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Hopes for such cuts amid signs that inflation has declined from its peak two summers ago has been a major reason the 10-year Treasury yield has mostly pulled back since October, when it climbed to its highest level since 2007.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Investors\u2019 expectations for future inflation, global demand for U.S. Treasurys and what the Fed does with interest rates can influence rates on home loans.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

\u201cThe economy has been performing well so far this year and rates may stay higher for longer, potentially slowing the spring homebuying season,\u201d said Sam Khater, Freddie Mac\u2019s chief economist.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

So far this year, mortgage applications to buy a home are down in more than half of all states compared to a year earlier, noted Khater.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

When mortgage rates rise, they can add hundreds of dollars a month in costs for borrowers, limiting how much they can afford in a market already out of reach for many Americans. They also discourage homeowners who locked in rock-bottom rates two or three years ago from selling. The average rate on a 30-year mortgage remains sharply higher than just two years ago, when it was 3.92%.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

The cost of financing a home has come down from its most recent peak in late October, when the average rate on a 30-year mortgage hit 7.79%, the highest level since late 2000.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Many economists have projected that mortgage rates will continue heading lower this year, though forecasts generally have the average rate on a 30-year home loan hovering around 6% by the end of the year.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Elevated mortgage rates and a dearth of available homes have kept the U.S. housing market mired in a slump the past two years. Sales of previously occupied U.S. homes sank to a nearly 30-year low last year, tumbling 18.7% from 2022.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

Copyright 2024 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n<\/div><\/div>\n

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\nAuthor: amyc<\/p>\n","protected":false},"excerpt":{"rendered":"