Economic Report: ‘Many prospective buyers are waiting for the volatility in mortgage rates to subside’: Mortgage rates hit 7.08%, Freddie Mac says

by | Nov 13, 2022 | Stock Market

The numbers: The housing sector continues to face headwinds. The 30-year fixed-rate mortgage averaged 7.08% as of Nov. 10, according to data released by Freddie Mac
FMCC,
+0.03%
on Thursday.  The 30-year was last at this level in mid-2002.

That’s up 13 basis points from the previous week — one basis point is equal to one hundredth of a percentage point, or 1% of 1%.  Last week, the 30-year was at 6.95%. Last year, the 30-year was averaging at 2.98% The average rate on the 15-year mortgage rose to 6.38%. 

“‘The housing market is the most interest-rate sensitive segment of the economy.’”

— Sam Khater, chief economist at Freddie Mac

“The housing market is the most interest-rate sensitive segment of the economy, and the impact rates have on homebuyers continues to evolve,” Sam Khater, chief economist at Freddie Mac, said in a statement. “Home sales have declined significantly and, as we approach year-end, they are not expected to improve,” he added. The adjustable-rate mortgage averaged 6.06%, up from the prior week.  What are they saying? Some homebuyers are fed up waiting for rates to stabilize and are jumping in with 7% rates, an industry group said. “Although mortgage rates remained above 7% last week, applications to buy a home increased for the first time in six weeks,” Bob Broeksmit, president and CEO of the Mortgage Bankers Association, said in a statement. Still, “many prospective buyers are waiting for the volatility in mortgage rates to subside, as well as for a clearer picture of the economic outlook,” he added. Mortgage demand overall continues to be weak, as refinances plunge, the MBA said on Wednesday.  The yield on the 10-year Treasury note
TMUBMUSD10Y,
3.899%
dropped to 3.8% during the morning trading session on Thursday. Got thoughts on the housing market? Write to MarketWatch …

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