Mortgage rates in US increase for first time in three weeks

Sep 15, 2023

(BLOOMBERG) US MORTGAGE rates rose for the first time since late August, ratcheting up the pressure on borrowers.

The average for a 30-year, fixed loan climbed to 7.18 per cent from 7.12 per cent a week earlier, Freddie Mac said on Thursday (Sep 14).

Borrowing costs have hovered above 7 per cent for the past five weeks, with the latest uptick further squeezing affordability. Potential buyers are in a tough position as they grapple with high rates and low inventory. Roughly 60 per cent of shoppers said they couldn’t find a home to buy due to limited offerings, according to a July survey from

Mortgage costs have climbed over the past year as the Federal Reserve sought to tame inflation by raising its benchmark rate. The central bank’s fight may not be over as underlying inflation data in August ran at a faster-than-expected pace. The Federal Open Market Committee meets next week.

“The reacceleration of inflation and strength in the economy is keeping mortgage rates elevated,” Sam Khater, Freddie Mac’s chief economist said.

The run-up in rates means buyers are spending more on their mortgages. A borrower with a US$600,000 loan would be paying US$4,065 a month at current levels, up 56 per cent from the start of 2022, when rates were near record lows.