Yahoo Finance Mortgage Rates in the US Rise for the First Time in Five Weeks
(Bloomberg) -- Mortgage rates in the US climbed for the first time since late May.
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The average for a 30-year, fixed loan was 6.95%, up from 6.86% last week, Freddie Mac said in a statement Wednesday. The results include an adjustment for the Fourth of July holiday.
The increase, after four straight weeks of declines, cuts into buying power for house hunters who are already struggling to find desirable, affordable properties. Builders have been working to help fill the inventory void, but they’re under more pressure recently.
Stocks for two of the biggest companies, Lennar Corp. and D.R. Horton Inc., were downgraded this week by analysts concerned about slowing sales and other signs of sluggishness, especially in the key markets of Florida and Texas.
Some homes, particularly ones that aren’t in move-in condition, have been lingering on the market longer, causing sellers to drop their asking prices.
“We are still expecting rates to moderately decrease in the second half of the year, and given additional inventory, price growth should temper, boding well for interested homebuyers,” Sam Khater, Freddie Mac’s chief economist, said in the statement.
Any interest-rate reductions by the Federal Reserve could provide a shot of energy to the flagging housing market. While Fed Chair Jerome Powell acknowledged this week that “quite a bit of progress” has been made in tamping down inflation, he didn’t give specific guidance on the timing of the first cut.
All eyes will be on June’s jobs report, due out Friday, which is expected to show cooling in the labor market.
“Falling inflation and employment could mean the Fed cuts interest rates earlier in the fall and that borrowers may start to see some relief from high borrowing costs,” said Hannah Jones, senior economic research analyst at Realtor.com.
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