After exceeding 7% last week, the 30-year fixed-rate mortgage (FRM) continued to rise, this week averaging 7.17%, up from last week’s average of 7.10%, according to the latest Primary Mortgage Market Survey® (PMMS®) released by Freddie Mac Thursday.
This week’s numbers:
- The 30-year FRM averaged 7.17% as of April 25, 2024, up from last week when it averaged 7.10%. A year ago at this time, the 30-year FRM averaged 6.43%.
- The 15-year FRM averaged 6.44%, up from last week when it averaged 6.39%. A year ago at this time, the 15-year FRM averaged 5.71%.
What the experts think:
“Mortgage rates continued rising this week,” said Sam Khater, Freddie Mac’s chief economist. “Despite rates increasing more than half a percent since the first week of the year, purchase demand remains steady. With rates staying higher for longer, many homebuyers are adjusting, as evidenced by this week’s report that sales of newly built homes saw the biggest increase since December 2022.”
Realtor.com Economist, Jiayi Xu commented:
“The Freddie Mac fixed rate for a 30-year mortgage climbed by 0.07 percentage points to 7.17% this week as the battle to tame inflation proved to be harder and longer than many initially expected. The consecutive price increases in both headline and core CPI data in March did not bolster the Fed’s confidence in rate cuts, suggesting we will live in a high rates environment for longer.
“Looking ahead, mortgage rates are expected to continue to be higher before stabilizing. In order to see mortgage rates move lower, better inflation readings are needed. The next chance for that is the release of the core Personal Consumption Expenditure Price Index (PCE) on Friday—the Fed’s preferred inflation measure for monetary policy decisions.
“Unfortunately, the rising mortgage rates occurred during what is typically a busy time in the housing market, potentially giving pause to prospective homebuyers as they weigh their purchasing decisions. Despite the increased mortgage rates leading to higher costs, it could also suggest a less competitive market where opportunities may exist for some homebuyers. For instance, buyers may find that sellers are more open to negotiation compared to the previous yea,” Xu added.
