Inventory shortages may be hampering buyer enthusiasm, but this data point out from Freddie Mac surely isn’t going to help. The lender reports that the average rate on the benchmark 30-year loan rose from 6.96 percent to 7.09 percent—the highest in more than 20 years.
A year ago this week, the rate averaged 5.13 percent.
This marks the fourth consecutive weekly increase for the average rate and the highest since early April 2002, when it averaged 7.13 percent. According to past tracking reports, the last time the average rate was above 7 percent was November 2022, when it stood at 7.08 percent.
And still, even with this week’s new rate highs, lenders are pointing to a shortage of homes for sale as the culprit for a tough residential real estate market.
“The economy continues to do better than expected and the 10-year Treasury yield has moved up, causing mortgage rates to climb,” said Sam Khater, Freddie Mac’s chief economist. “Demand has been impacted by affordability headwinds, but low inventory remains the root cause of stalling home sales.”