The long-term rate has climbed 66 basis points in six weeks, boosted by the post-election selling spree in Treasuries.
A widely tracked index of U.S. home prices has hit a new high, surpassing a previous peak set in July 2006 — well before the all-out housing crisis of 2007-2009.
Was it a case of pre-election jitters about the housing market’s direction and interest rates poised to move higher? That could have been a factor behind the release of pent-up demand that pushed up sales of existing homes in October to a near 10-year-high annualized rate.
An historic sell-off in the Treasury market has pushed the average 30-year fixed rate to 3.94 percent, up from 3.57 percent last week, Freddie Mac says.
For now, average mortgage rates stayed in mostly historically low territory this week, but they could be creeping higher in coming weeks.
A shortage of homes didn’t stop Americans from buying existing properties as sales rose 3.2 percent in June, reaching the highest annual rate since June — 5.47 million units, according to the National Association of Realtors.
The bad news: The bond market is anticipating a Federal Reserve rate increase later this year.
Zillow is forecasting that rents will rise in 34 of the 35 largest U.S. metros, though 11 of the 35 are expected to see slower growth.
This demographic shit has also been playing a role in both the lack of inventory and in the slowness in new home sales over the past several years.
A total of 39,775 investors — both individuals and institutions — completed at least one home flip in the second quarter of 2016, the highest number of home flippers since the second quarter of 2007 — a nine-year high.