The average rate on the popular 30-year mortgage hit 3.64% on Monday after the Federal Reserve announced plans to offload mortgage-backed bonds sooner than originally expected, according to CNBC. Expectations for a potential boost in economic activity caused bonds to sell off at the fastest pace in 9 months, and potential home buyers could pay the price.
Buyers putting down 20% on a median-priced single-family home at $350,000 can expect a monthly payment $125 higher than prices just three weeks ago. Mortgages have fluctuated throughout the pandemic, rising and falling along with housing demand during each wave of the coronavirus. The latest jump again coincides with pandemic expectations as experts look ahead to upcoming moderation in the Omicron surge after a spike in cases and waning symptoms.
The average rate on the popular 30-year mortgage hit 3.64% on Monday morning, after rising sharply last week, according to Mortgage News Daily. On Friday, the rate was 3.5%, and last Monday it was 3.29%.
“Last week saw bonds sell off at their fastest pace in at least 9 months on a combination of a hawkish pivot from the Fed and paradoxical omicron optimism,” wrote Matthew Graham, chief operating officer at MND. “Corporate bond issuance and looming Treasury issuance added to the selling sentiment.”
Advertisement
Related Stories
Government + Policy
Can Limiting Hedge Funds from Buying Houses Lower Prices?
Large institutions make up just 13% of all investor home buyers
Housing Policy + Finance
Even With Inflation Running Hot and Elevated Mortgage Rates, Buyer Demand Rises
Mortgage rates will likely stay high for the next few months, but that doesn't seem to be deterring homebuyers
Housing Policy + Finance
The Garden State Takes a New Approach to Expanding Affordable Housing
Recent legislation in New Jersey could provide inspiration for eliminating affordable housing hurdles in other places with strong housing markets