{"id":12764,"date":"2023-08-18T13:10:41","date_gmt":"2023-08-18T13:10:41","guid":{"rendered":"https:\/\/isafespend.com\/personal-finance\/mortgage-rates-top-7-but-lack-of-homes-still-the-biggest-problem-for-the-market-freddie-mac\/"},"modified":"2023-08-18T13:10:58","modified_gmt":"2023-08-18T13:10:58","slug":"mortgage-rates-top-7-but-lack-of-homes-still-the-biggest-problem-for-the-market-freddie-mac","status":"publish","type":"post","link":"https:\/\/isafespend.com\/?p=12764","title":{"rendered":"Mortgage rates top 7% but lack of homes still the biggest problem for the market: Freddie Mac"},"content":{"rendered":"
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Mortgage rates increased to a new high this week, but a lack of housing inventory remains the biggest hurdle for the market, according to Freddie Mac.<\/p>\n

The average 30-year fixed-rate mortgage increased to 7.09% for the week ending August 17, according to Freddie Mac’s latest\u00a0Primary Mortgage Market Survey. That’s up from the\u00a0previous week\u00a0when it averaged 6.96%. A year ago, the 30-year fixed-rate mortgage averaged 5.13%.\u00a0<\/p>\n

The average rate for a 15-year mortgage was 6.46%, up from 6.34% last week and 4.55% last year.\u00a0 \u00a0<\/p>\n

“The last time the 30-year fixed-rate mortgage exceeded 7% was last November,” Freddie Mac Chief Economist Sam Khater said. “Demand has been impacted by affordability headwinds, but low inventory remains the root cause of stalling home sales.”<\/p>\n

Mortgage rates climbed in sync with the\u00a010-year Treasury rates, which hit the highest level since the summer of 2007 and investors are signaling that the Federal Reserve may raise interest rates again, according to Keeping Current Matters Chief Economist George Ratiu.<\/p>\n

The Federal Reserve recently\u00a0released the minutes\u00a0from its July meeting, which showed that members are worried that inflation will linger longer than expected at an elevated level. Inflation rose to 3.2% in July, rising slightly from the previous month, according to the Consumer Price Index (CPI)\u00a0released by the Bureau of Labor Statistics\u00a0(BLS).\u00a0 \u00a0\u00a0<\/p>\n

“Coming out of a three-year pandemic, the economy continues to expand, boosted by solid consumer spending and business investment,” Ratiu said in a statement. “For most Americans, the economic growth means job security and better paychecks. While employment momentum is moderating, there is still a 3.8 million gap between the number of open positions and unemployed people looking for work.\u00a0<\/p>\n

“The upside to the strong job market is a firmer financial foundation for households who have weathered a 40-year high surge in prices,” Ratiu continued. “The downside to the strong wage gains is that the Fed remains hawkish on the outlook for taming inflation this year.”<\/p>\n

If you are ready to shop for a mortgage, you could get a better rate by looking at several lenders. Credible can help you compare interest rates from multiple mortgage lenders and choose the one with the best rate for you.<\/p>\n

THESE TWO FACTORS COULD BE DRIVING YOUR CAR INSURANCE COSTS UP<\/strong><\/p>\n

Here’s how much more homebuyers are paying today<\/strong><\/h2>\n

The increase of the 30-year mortgage rate to over 7% from 6.1% in February means buyers today are paying 13% more for a median-priced home, Ratiu said.<\/p>\n

Moreover, the rate increase discourages existing homeowners from trading up, according to Ratiu. Consumers with a 20% down payment that financed their home purchase mortgage with a rate below 4% at the start of 2022 are paying roughly $1,300 monthly. At the current mortgage rate, borrowers would have to pay $2,300 a month on a similarly priced home.<\/p>\n

“Even with purchasing power shrinking, changing life stages and personal circumstances are leading buyers to adjust to the new normal and find a way forward,” Ratiu said. “Homeowners smiling at their sub-4% mortgage rate on the other hand, may frown when looking at having to trade it for a much larger financial burden.”<\/p>\n

If you want to take advantage of interest rates before they potentially go up, you could consider shopping for the right mortgage or refinancing your existing one. Visit Credible to speak with a mortgage expert and get your questions answered.<\/p>\n

MORE STUDENTS TURNING TO FEDERAL AND PRIVATE STUDENT LOANS TO FINANCE COLLEGE: SURVEY<\/strong><\/p>\n

Homeowners that stay put delaying critical repairs\u00a0<\/strong><\/h2>\n

Inflation and rising prices are the main reason why homeowners are delaying necessary renovations to their homes, according to a recent Nationwide Agency Forward\u00a0survey. Thirty-one percent said they are putting off essential repairs for wear and tear to their roofs, kitchens or bathrooms and flooring.\u00a0<\/p>\n

Here’s what’s keeping homeowners from making those necessary updates:<\/p>\n