WASHINGTON–Mortgage rates topped 7% last week for the first time this year as new data show home sales in March posted their biggest monthly drop in more than a year.
Even if only a few basis points above where rates have been in 2024, the 7% threshold is considered a psychological barrier for many would be.
According to Freddie Mac, the average rate on the standard 30-year fixed mortgage jumped by nearly a quarter percentage point to 7.1%, according to a survey of lenders. That is the highest level since late 2023 and the largest weekly increase in nearly a year.
Home Sales Decline
Meanwhile, sales of existing homes in March were down 4.3% from February, with the National Association of Realtors saying it was the largest percentage decline on a monthly basis since November 2022.
That news comes after sales, which had dropped to their lowest levels in 30 years during 2023, had reversed course and risen during the first two months of this year as rates had declined.
The increase in rates comes at the same time home prices have also again risen, as have the costs of owning a home.
And, as CUToday.info reported here, all of that is contributing to a unique situation where there is a gap in mortgage rates between what’s currently available in the market and the rates being paid by many homeowners, leading to a “national lock-in effect,” according to one new report.
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