WASHINGTON–The average rate on the 30-year fixed-rate mortgage surpassed 7% last week to hit its highest level in Freddie Mac’s weekly survey, the first time it has hit that mark since 2002.
Rates on 30-year fixed-rate mortgages — the most popular kind among home buyers in the United States — rose to 7.08%, up from 6.94% last week and 3.14% from this time last year, according to the latest weekly survey by Freddie Mac.
Rates had already surpassed 7% in other rate tracking surveys, but this is the first time that the closely watched Freddie Mac survey surpassed that level in two decades, according to the secondary market giant.
“As inflation endures, consumers are seeing higher costs at every turn, causing further declines in consumer confidence this month,” Sam Khater, the chief economist at Freddie Mac, said in a statement. “In fact, many potential home buyers are choosing to wait and see where the housing market will end up, pushing demand and home prices further downward.”
Although mortgage rates have rocketed higher over a short period, they are still slightly below their long-term average of about 7.8%, according to Freddie Mac, which began tracking borrowing costs in 1971. In the early 1980s, rates stretched well into the double digits, exceeding 18% in 1981.
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