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Mortgage Rates Have Gone Through the Roof Since Last Year: Bad News for Home Buyers

Homebuyers are at cross ends with investors vying for higher interest rates. The buyers market is threatened as they will find it hard to find housing within their budget. MarketWatch reports that emerging data isn’t so favorable as homebuyers have to beat inflation when looking for a house that matches their financial constraints.

Rise of mortgage rates

As the pandemic first made its headway into the country, it sent shockwaves into the financial markets and finally led to lockdowns. News AKMI reports that the average fixed price mortgage of 3.45% for 30 years was seen in the first week of the new year with a quarter rise. Excerpts in the field have pointed doubt that this has been the highest average rate for a 30-year loan since march last year.

Last year the going rate was 2.2% for a 30year fixed-rate mortgage. According to data reports, it was near record low levels. And those seeking a 15-year fixed-rate mortgage saw a rise of 19 basis points last week which definitely averaged to 2.3% rise. Pehal News reports, with the 5-year treasury indexed adjustable-rate mortgage average to 2.57%, which also has seen a rise of 16 basis points last week, it isn’t giving any hope to homebuyers.

Impact on homebuyers

The rising rates have been a concern that even the Federal Reserve has noted and was wary of the situation going worse if not checked. Homebuyers are hopeful, though and trying the wait and watch policy. Those who have still gone ahead and made purchase will find that it will impact their margins as they have to work doubly hard to pay off the higher interest rates of rising home prices.

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