Mortgage rates rise after home sales jump in October
Mortgage rates continue to march toward 7% after previous dip revived home sales
Bahnsen Group managing partner David Bahnsen discusses market volatility and analyzes the real estate market on 'The Big Money Show.'
Mortgage rates climbed closer to 7% this week while sales of existing homes saw a revival from a dip in rates two months ago.
Freddie Mac's latest Primary Mortgage Market Survey, released Thursday, showed that the average rate on the benchmark 30-year fixed mortgage rose to 6.84% from last week's reading of 6.78%. The average rate on a 30-year loan was 7.29% a year ago.
A "for sale" sign is posted in front of a home for sale in San Rafael, California, on March 18, 2022. (Justin Sullivan/Getty Images / Getty Images)
Meanwhile, the National Association of Realtors on Thursday reported that existing home sales jumped 3.4% in October from the month before to 3.96 million, lifting off a 14-year low in September.
"Home sales surged in October because mortgage rates plunged below 6.25% in September," said Holden Lewis, home and mortgage expert at NerdWallet. "When rates dropped, buyers acted quickly — making successful offers in September and closing in October."
Many would-be buyers and sellers are holding out to see if rates fall further. Currently, about 80% of mortgage holders have a rate below 5%, according to a Zillow survey.
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The average rate on the 15-year fixed mortgage also fell slightly to 6.02% from 5.99% last week. One year ago, the rate on the 15-year fixed note averaged 6.67%.