Rates for home loans jumped in the most recent week as economic data firmed enough to seal a Federal Reserve rate hike, mortgage finance provider Freddie Mac said Thursday.
The 30-year fixed-rate mortgage averaged 4.30%, up nine basis points during the week. The 15-year fixed-rate mortgage averaged 3.50%, up from 3.42% last week.
Still, Freddie thinks the days of rock-bottom mortgage rates are over. “Increasing inflation, continued gains in the labor market and the Fed’s intentions for further rate increases—all three will keep pushing mortgage rates up this year,” the company said in a release.
Higher interest rates mean Americans will qualify for a smaller home loan to buy a home with. This is bad news for home sellers because they will most likely be forced to sell at a cheaper price this year than they could of last year. It also means that buyers will either have to folk over a larger down payment for the same home they could of afforded last year or a more likely scenario is they will have to settle for a smaller/cheaper home this year.
Expect to see home sales slowing down this summer as reality sets in for buyers and sellers that the cheap money game is over.
http://www.marketwatch.com/story/mortgage-rates-jump-as-economy-revs-up-2017-03-16