Mortgage Rates Continue to Rise, Slowing Application Volume


Mortgage rates continued to rise during the week ended May 25, with the average rate for a 30-year fixed-rate mortgage at 6.57%, up from 6.39% the previous week and up from  5.10% a year ago, according to Freddie Mac’s Primary Mortgage Market Survey.

The average rate for a 15-year fixed-rate mortgage was 5.97%, up from 5.75% the previous week and up from 4.31% a year ago.

“The U.S. economy is showing continued resilience which, combined with debt ceiling concerns, led to higher mortgage rates this week,” says Sam Khater, chief economist for Freddie Mac, in a statement. “Dampened affordability remains an issue for interested homebuyers and homeowners seem unwilling to lose their low rate and put their home on the market. If this predicament continues to limit supply, it could open up an opportunity for builders to help address the country’s housing shortage.”

Earlier this week, the Mortgage Bankers Association reported that the recent rise in rates resulted in mortgage applications falling 4.6% during the week ended May 19.

Applications for refinances decreased 5% compared with the previous week and were down 44% compared with the same week one year earlier.

Applications for purchases decreased 4% compared with the previous week and were down 30% compared with a year ago.

Photo: David Kristianto

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