Average US mortgage rates have topped 6 per cent for the first time since the 2008 financial crisis, showing how the Federal Reserve’s aggressive policy monetary tightening is ratcheting up the cost of financing the purchase of a home.
The average 30-year fixed rate mortgage rose to 6.02 per cent, up from 5.89 per cent a week ago and 2.86 per cent in the same week last year, according to Freddie Mac’s weekly survey. The borrowing benchmark has nearly doubled since January in the steepest and fastest increase in interest rate in over 50 years.
The rapid rises in mortgage rates track with the Fed’s campaign to lift its own benchmark interest rate in a drive to damp down surging US inflation. Futures markets predict the central bank will raise the rate by 0.75 percentage points for the third consecutive time when it meets next week.