The U.S. mortgage market has seen a remarkable uptick in borrowing costs for the fourth successive week, reversing the temporary relief homeowners experienced in the summer. While inflation showed signs of easing and the Federal Reserve’s rate cuts seemed imminent, the surge in mortgage rates has overshadowed these positives. According to recent data from Freddie Mac, the average 30-year fixed mortgage rate reached 6.54% in the week of October 24, the highest since early August but still below the 7.22% peak seen in early May.

September saw the mortgage rates dip to a two-year low of 6.08%, yet this failed to invigorate the housing sector. Despite expected demand, sales of pre-owned homes—the major component of the housing market—declined by 1% in September compared to the previous month, to a seasonally adjusted annual rate of 3.84 million units. Mortgage applications also declined over the same period, reaching a low not seen since July.

The subdued housing demand may stem from timing; many families prefer buying and selling homes in spring when the new school year approaches. With the Federal Reserve indicating it might continue to lower interest expenses through 2025, potential buyers are likely waiting for even better rates.

The upward trend in mortgage rates is linked to robust economic indicators, which have outperformed expectations and shifted market sentiment, pushing up Treasury yields. Recent reports reveal strong job growth and steady consumer spending, suggesting a slower pace of future Fed rate cuts. Meanwhile, ongoing supply constraints are keeping home prices elevated, with national home prices rising for 15 consecutive months as reported by NAR.

Source: 週間の住宅ローン金利が上昇、住宅需要に影響を与える要因