Mortgage rates in the United States resumed their upward climb, reaching the highest level since August 2009.
The average for a 30-year loan jumped to 5.27% from 5.10% last week, Freddie Mac said in a statement Thursday.
The Federal Reserve yesterday raised its benchmark rate by a half point, the biggest bump since 2000, and signaled further hikes to come in its effort to cool inflation and the overheated housing market. Higher mortgage costs — already up more than 2 percentage points this year — may increasingly push out would-be home buyers and ease competition for a scarce supply of listings.
“While housing affordability and inflationary pressures pose challenges for potential buyers, house price growth will continue but is expected to decelerate in the coming months,” Sam Khater, Freddie Mac’s chief economist, said in the statement.
Tight inventory is beginning to crimp purchases. But plenty of pent-up demand from the past couple of years and a rising share of cash buyers make a crash in home sales unlikely, according to Matthew Pointon, senior property economist at Capital Economics.