June 27, 2022

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U.S Mortgage Rates Surge for a Third Consecutive Week

2 min read

In the week ending March 31, 2022, mortgage rates rose sharply for a third consecutive week.

30-year fixed rates jumped by 25 basis points to 4.67%. 30-year fixed rates surged by 26 basis points in the week prior. It was the highest mortgage rate since December 2018.

Year-on-year, 30-year fixed rates were up by 149 basis points. 30-year fixed rates were down by 24 basis points since November 2018’s last peak of 4.94%.

Economic Data from the Week

It was a busier first half of the week. Consumer confidence, private sector PMIs, and ADP nonfarm payroll figures were in focus.

The stats were skewed to the positive, supporting Fed Chair Powell’s willingness to lift rates at a more aggressive pace.

With inflation already at 40-year highs, China’s latest lockdown measures and Russia’s invasion of Ukraine suggest inflation will go even higher. Such an eventuality would force the Fed to more aggressively rein in inflation, which would translate into higher mortgage rates.

Freddie Mac Rates

The weekly average rates for new mortgages, as of March-31, 2022, were quoted by Freddie Mac to be:

According to Freddie Mac,

  • Mortgage rates rose once more amidst the current inflation environment.

  • Ongoing supply chain disruptions and demand for goods are likely to push inflation higher yet.

  • Purchase demand has softened but outpaces expectations.

  • First-time homebuyer demand and those waiting for rates to fall to cyclical lows continue to support the housing market.

Mortgage Bankers’ Association Rates

For the week ending March 25, 2022, the rates were:

  • Average interest rates for 30-year fixed with conforming loan balances rose from 4.50% to 4.80%. Points decreased from 0.59 to 0.56 (incl. origination fee) for 80% LTV loans.

  • Average 30-year fixed mortgage rates backed by FHA increased from 4.40% to 4.66%. Points fell from 0.73 to 0.71 (incl. origination fee) for 80% LTV loans.

  • Average 30-year rates for jumbo loan balances increased from 4.11% to 4.40%. Points declined from 0.51 to…

2022-04-02 18:12:08

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