The 30-year fixed-rate mortgage (FRM) averaged 5.89% this week, up from 5.66% last week, according to the latest Primary Mortgage Market Survey® (PMMS®) released by Freddie Mac today. Freddie Mac points to this week’s rates as reaching their highest point in 14 years.
Key findings this week:
- 30-year fixed-rate mortgage averaged 5.89% with an average 0.7 point as of September 8, 2022, up from last week when it averaged 5.66%. A year ago at this time, the 30-year FRM averaged 2.88%.
- 15-year fixed-rate mortgage averaged 5.16% with an average 0.8 point, up from last week when it averaged 4.98%. A year ago at this time, the 15-year FRM averaged 2.19%.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.64% with an average 0.4 point, up from last week when it averaged 4.51%. A year ago at this time, the 5-year ARM averaged 2.42%.
What the experts are saying:
“Mortgage rates rose again as markets continue to manage the prospect of more aggressive monetary policy due to elevated inflation,” said Sam Khater, Freddie Mac’s chief economist. “Not only are mortgage rates rising but the dispersion of rates has increased, suggesting that borrowers can meaningfully benefit from shopping around for a better rate. Our research indicates that borrowers could save an average of $1,500 over the life of a loan by getting one additional rate quote and an average of about $3,000 if they get five quotes.”
“The Freddie Mac fixed rate for a 30-year home loan climbed this week as markets continue to adjust for uncertainty and anticipate further monetary tightening by the Fed. Mortgage rate volatility has been high in the last couple months as the market shifts with each new piece of economic intel,” said Hannah Jones, economic data analyst for realtor.com®. “This week, investors awaited the highly anticipated release of the Fed’s Beige Book, for a regional pulse on the U.S. economy and indicators of what may happen with interest rates at the FOMC meeting in a couple of weeks. Wednesday’s release indicated sustained price increases in all twelve Fed districts, though a moderating rate of increase in nine of these districts. This could be an early sign of the eventual ease in inflation, which would precede slowed interest rate hikes.
“Though mortgage rates are still more than 250 basis points higher than a year ago, homebuyers are finally seeing some relief from record-high listing prices, which fell in August as growth continued slowing year-over-year. As the summer wraps up and kids head back into the classroom, typical seasonal trends of cooling demand coupled with this year’s rebalancing housing market will mean more homes are up for grabs for buyers who are still looking this fall. Despite a slightly more favorable homebuying environment, still-high rates mean a typical monthly mortgage payment would be roughly $2,000 in August, $750 more than this time last year. However, there is hope on the horizon as increased inventory and slowing time on market means buyers may benefit from more price reductions and more homes in their budget,” Jones concluded.
