Monthly Housing Payments Reach Record High Amidst Rise in Mortgage Rates

Real estate brokerage Redfin reported that monthly housing payments hit a new peak this week following a rise in mortgage rates, which was the first in over a month. The average 30-year fixed-rate mortgage surged to 6.39 percent, resulting in a typical homebuyer’s monthly payment of $2,538. This is up from last year's average mortgage rate of 5.11 percent. The increase in mortgage rates came after a decline in new homes under construction, which could add even more strain to potential buyers.

The lack of inventory coupled with high mortgage rates and soaring prices have made homes unaffordable for many prospective buyers. According to Taylor Marr, Redfin’s deputy chief economist, some buyers are discouraged by this week's increase in mortgage rates. In March, nationwide home sales plummeted by 22 percent compared to the same time last year, and monthly existing home sales declined by 2.4 percent to an annual rate of 4.4 million, according to figures released by the National Association of Realtors. The housing market is unique, with home sales attempting to recover, but they are highly sensitive to changes in mortgage rates, and more supply is needed to fully satisfy demand.

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Source: https://thehill.com/business/3962682-monthly-housing-payments-hit-all-time-high-report/