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Every Thursday,\u00a0Freddie Mac<\/em>\u00a0releases the results of their\u00a0Primary Mortgage Market Survey<\/em><\/a>\u00a0which reveals the most recent movement in the 30-year fixed mortgage rate. Last week, the rate was announced as 3.01%. It was the first time in three months that the mortgage rate surpassed 3%. In a\u00a0press release<\/a>\u00a0accompanying the survey, Sam Khater, Chief Economist at\u00a0Freddie Mac<\/em>, explains:<\/p>\n \u201cMortgage rates rose across all loan types this week as the 10-year U.S. Treasury yield reached its highest point since June.\u201d<\/em><\/p><\/blockquote>\n The reason Khater mentions the 10-year U.S. Treasury yield is because there has been a very strong relationship between the yield and the 30-year mortgage rate over the last five decades. Here\u2019s a graph showing that relationship:<\/p>\n Average Historical Spread<\/p><\/div>\n The relationship has also been consistent throughout 2021 as evidenced by this graph:<\/p>\n The 2021 Relationship Between Mortgage Treasury Rates Remain Consistent<\/p><\/div>\n The graph also reveals the most recent jump in mortgage rates was preceded by a jump in the 10-year Treasury rate (called out by the red circles<\/em>).<\/p>\n According to\u00a0Investopedia<\/em><\/a>:<\/p>\n \u201cThere are a number of economic factors that impact Treasury yields, such as interest rates, inflation, and economic growth.\u201d<\/em><\/p><\/blockquote>\n Since there are currently concerns about inflation and economic growth due to the pandemic, the Treasury yield spiked last week. That spike impacted mortgage rates.<\/p>\n Khater, in the\u00a0Freddie Mac<\/em>\u00a0release mentioned above, says:<\/p>\n \u201cWe expect mortgage rates to continue to rise modestly which will likely have an impact on home prices, causing them to moderate slightly after increasing over the last year.\u201d<\/em><\/p><\/blockquote>\n Nadia Evangelou, Senior Economist and Director of Forecasting for the\u00a0National Association of Realtors<\/em>\u00a0(NAR), also\u00a0addresses the issue<\/a>:<\/p>\n \u201cConsumers shouldn\u2019t panic. Keep in mind that even though rates will increase in the following months, these rates will still be historically low. The National Association of REALTORS forecasts the 30-year fixed mortgage rate to reach 3.5% by mid-2022.\u201d<\/em><\/p><\/blockquote>\n Forecasting mortgage rates is very difficult. As Mark Fleming, Chief Economist at\u00a0First American,\u00a0<\/em>once quipped<\/a>:<\/p>\n \u201cYou know, the fallacy of economic forecasting is don\u2019t ever try and forecast interest rates and or, more specifically, if you\u2019re a real estate economist mortgage rates, because you will always invariably be wrong.\u201d<\/em><\/p><\/blockquote>\n That being said, if you\u2019re either a first-time homebuyer or a current homeowner thinking of moving into a home that better fits your current needs, keep abreast of what\u2019s happening with mortgage rates. It may very well impact your decision.<\/p>\n Contact us:<\/strong> Let\u2019s Connect:<\/strong> Since there are currently concerns about inflation and economic growth due to the pandemic, the Treasury yield spiked last week. That spike impacted mortgage rates. What Does This Mean for You? Finish Reading The Main Key To Understanding the Rise in Mortgage Rates<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[69],"tags":[38,15,10,18,27,91,52,9,49,42,387,280,33,228,63,20,12,48,28,47,19,17],"_links":{"self":[{"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/posts\/2103"}],"collection":[{"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/comments?post=2103"}],"version-history":[{"count":3,"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/posts\/2103\/revisions"}],"predecessor-version":[{"id":2108,"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/posts\/2103\/revisions\/2108"}],"wp:attachment":[{"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/media?parent=2103"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/categories?post=2103"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/phphouses.com\/blog\/wp-json\/wp\/v2\/tags?post=2103"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"\"](\"https:\/\/phphouses.com\/blog\/wp-content\/uploads\/2021\/10\/kcm-infographic-1633446775.png\")
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So, What Impacts the Yield Rate?<\/strong><\/h4>\n
What Does This Mean for You?<\/strong><\/h4>\n
Bottom Line<\/strong><\/h3>\n
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