The average interest rate on U.S. mortgages continued rising to record highs last week as the Federal Reserve signals an upcoming tightening of monetary policy to tame inflation.
The 30-year fixed mortgage rate increased for the fourth consecutive week to 4.9 percent, now 1.5 percentage points higher than a year ago, the Mortgage Bankers Association (MBA) said on Wednesday.
The average was 4.8 percent a week earlier.
“Mortgage application volume continues to decline due to rapidly rising mortgage rates, as financial markets expect significantly tighter monetary policy in the coming months,” MBA said.
The MBA added that its Market Composite Index, a measure of mortgage loan application volume, dropped 6.3 percent on a seasonally adjusted basis from one week earlier.
Home prices have shot up 35 percent since the pandemic began, after the Fed had slashed interest rates to near zero in a bid to support the crisis-hit economy.
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