The Mortgage Bankers Association said the average 30-year fixed rate rose 19 basis points to 7.49 percent in the week ended October 2. Loan applications fell 4.2 percent.
The average rate on the most common US home loan rose last week to its highest in almost three years, Reuters reported, citing the Mortgage Bankers Association. The 30-year fixed rate increased 19 basis points to 7.49 percent in the week ended October 2. The association said the rate was last higher in November 2023.
Mortgage applications fell 4.2 percent from the previous week, with refinancing applications dropping sharply. Joel Kan, the MBA's deputy chief economist, said very few homeowners had an incentive to refinance at these rates and that the jump in borrowing costs had caused many potential buyers to step back.
Reuters said mortgage rates track the 10-year Treasury yield, which earlier in the week hit a 24-year high as oil prices and growth data fed inflation worries. Home borrowing rates are up about 1.4 percentage points since joint US-Israeli strikes on Iran began in late February, the agency said, tracking a similar rise in the 10-year yield, which topped 5.3 percent on Monday.
The item lands four weeks before November 3 elections. Reuters cited a Reuters/Ipsos poll completed Monday that put the cost of living as the top issue for voters and President Donald Trump's approval at 32 percent. Those poll figures are from that survey, not from the MBA release.
The MBA figure is a weekly average, not a closing market print. The Fed's next policy meeting is October 27-28.
People Sentiments Negative
- Joel Kan said very few homeowners have an incentive to refinance at these rates.
- He said the jump in borrowing costs has caused many potential borrowers to step back from the purchase market.