Mortgage rates in the United States continue to be relatively high as the economy shows signs of strength. According to data released by Freddie Mac on Thursday, the 30-year fixed-rate mortgage is averaging 7.12% as of September 7, a slight decrease of 6 basis points from the previous week. However, compared to a year ago, when the average rate was 5.89%, rates have significantly increased.
A Closer Look at the Numbers
The average rate for a 15-year mortgage also saw a slight decrease from last week, dropping from 6.55% to 6.52%. However, this is still substantially higher than the rate of 5.16% recorded a year ago. These figures are based on thousands of applications received from lenders across the country and submitted to Freddie Mac during the mortgage application process.
The Impact of Economic Data
Chief economist at Freddie Mac, Sam Khater, commented on the current state of mortgage rates, stating, “While inflation has decelerated, firmer economic data have put upward pressure on mortgage rates.” This suggests that even though inflation has slowed down, other positive economic indicators have contributed to the higher rates.
Stagnant Housing Market
In light of the current mortgage rates, experts in the mortgage banking industry predict that the housing market will remain stagnant until housing inventory increases and rates become more affordable. Bob Broeksmit, president and CEO of the Mortgage Bankers Association, expressed this sentiment, saying, “The housing market appears to be stuck heading into autumn, with sales activity likely to stay stagnant until housing inventory increases and mortgage rates decline to more affordable levels.”
In conclusion, while the U.S. economy continues to demonstrate strength, mortgage rates remain elevated. The impact of economic data and housing inventory levels will be crucial in determining future rate adjustments and overall market activity.