According to data released by Freddie Mac, mortgage rates in the United States have increased for the third consecutive week. This rise comes as the economy demonstrates signs of strength through low unemployment rates and robust wage growth.
The Numbers
As of August 10, the 30-year fixed-rate mortgage stands at 6.96%. This represents a 6 basis points increase compared to the previous week, where it was at 6.9%. In simpler terms, each basis point represents one-hundredth of a percentage point.
Additionally, the average rate on the 15-year mortgage saw an increase from 6.25% to 6.34% over the same period. Last year, the 15-year mortgage stood at 4.59%.
The Insights
Freddie Mac’s weekly report on mortgage rates is derived from thousands of applications received from lenders across the country. These applications are submitted when borrowers apply for mortgages.
Another source, Mortgage News Daily, also reported that as of Thursday afternoon, the 30-year fixed-rate mortgage averaged at 7.05%.
Expert Opinions
Sam Khater, the chief economist at Freddie Mac, expressed concerns over the impact of high rates on affordability. He stated, “There is no doubt continued high rates will prolong affordability challenges longer than expected, particularly with home prices on the rise again.”
Bob Broeksmit, president and CEO of the Mortgage Bankers Association, attributed the rising rates to ongoing economic volatility and the downgrading of the U.S. government’s credit rating. He added that both prospective buyers and sellers are feeling the squeeze of higher rates alongside low housing inventory, resulting in a noticeable slowdown in activity during the summer months.