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Mortgage rates leap to 7-year highs; 30-year at 4.9 percent

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WASHINGTON — Long-term US mortgage rates leaped this week to their highest levels in seven years amid global anxiety over rising interest rates that has gripped financial markets.

Costs for would-be home buyers are climbing. Mortgage buyer Freddie Mac said Thursday that the rate on 30-year fixed-rate mortgages jumped to an average 4.9 percent this week from 4.71 percent last week. That’s the highest level for the benchmark rate since April 2011. A year ago, it stood at 3.91 percent.

The average rate on 15-year fixed-rate loans rose to 4.29 percent this week from 4.15 percent last week.

The Federal Reserve recently signaled its confidence in the economy by raising a key interest rate for the third time this year, forecasting another hike before year’s end.

Strong economic data and a positive outlook from Fed officials have spurred a sell-off in US Treasury bonds, especially longer-term ones, stoking concerns on even higher interest rates.
As anxiety over higher rates spiraled, financial markets around the world suffered a massive sell-off. US stocks marked their biggest drop since February on Wednesday, as the Dow Jones industrial average slid 831 points. Stocks sank again on Wall Street on Thursday morning.

President Donald Trump stepped in to assert that the Fed ‘‘is making a mistake’’ with its rate increases, and accused the central bank of having ‘‘gone crazy.’’

Interest rates on Treasury bonds have climbed to the highest levels in seven years as their prices have dropped. The yield on the key 10-year Treasury note, which tends to influence mortgage rates, was at 3.16 percent Thursday morning.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. The average fee on 30-year fixed-rate mortgages rose to 0.5 point from 0.4 point last week. The fee on 15-year mortgages also increased to 0.5 point from 0.4 point.

The average rate for five-year adjustable-rate mortgages jumped to 4.07 percent from 4.01 percent last week. The fee was unchanged at 0.3 point.

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