Mortgage Rates Top 7%, Highest Since 2002

Published by FOX Business | October 27, 2022

The average rate for a 30-year fixed mortgage topped 7% for the first time in two decades at the end of October.

Freddie Mac reported that the average long-term U.S. mortgage rate climbed to 7.08% from 6.94% at the end of October. A year ago, the 30-year rate averaged 3.14%.

“The 30-year fixed-rate mortgage broke seven percent for the first time since April 2002, leading to greater stagnation in the housing market.”

–Sam Khater, Chief Economist, Freddie Mac

The 15-year fixed-rate mortgage averaged 6.36%, up from last week’s average of 6.23%. A year ago at this time, the 15-year FRM averaged 2.37%.

Finally, the 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 5.96%, up from last week’s 5.71% average. A year ago at this time, the 5-year ARM averaged 2.56%.

“As inflation endures, consumers are seeing higher costs at every turn, causing further declines in consumer confidence this month,” he continued. “In fact, many potential homebuyers are choosing to wait and see where the housing market will end up, pushing demand and home prices further downward.”

The Fed has raised its key benchmark lending rate five times this year in an effort to reduce skyrocketing inflation, including three consecutive 0.75 percentage point increases that have brought its key short-term borrowing rate to a range of 3% to 3.25%, the highest level since 2008.

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