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Mortgage rates rose for the sixth consecutive week as purchase demand continued to decline in the stagnant housing market.
The average interest rate on the benchmark 30-year fixed mortgage rose to 6.79% from 6.72% last week, according to Freddie Mac’s latest Primary Mortgage Market Survey released Thursday. A year ago, the average interest rate on a 30-year loan was 7.50%.
See homes for sale in Austin, TX on May 22nd. (Brandon Bell/Getty Images/Getty Images)
“In the current market environment, it’s clear that purchase demand is very sensitive to mortgage rates,” said Sam Cater, chief economist at Freddie Mac. “As soon as interest rates started rising in early October, purchase offers fell, falling 10% last month.”
Many buyers and sellers are waiting to see if interest rates will fall further. According to Zillow research, about 80% of mortgage holders currently have interest rates below 5%.
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The average interest rate for 15-year fixed mortgages also rose to 6% from 5.99% last week. A year ago, the average interest rate on a 15-year fixed bond was 6.81%.
