Mortgage rates crept back up closer to 7% as home prices also jump up
Housing prices hit another all-time high
Average rates for 30-year mortgages increased to 6.95% last week. (iStock )
Mortgage rates jumped up this week, hovering closer to 7%. This jump ended week's run of dropping rates. Interest rates for 30-year, fixed-rate mortgages averaged 6.95%, Freddie Mac reported.
"Mortgage rates increased this week, coming in just under seven percent," Sam Khater, Freddie Mac’s chief economist, explained. "Both new home and pending home sales are down, causing active listings to rise. We are still expecting rates to moderately decrease in the second half of the year and given additional inventory, price growth should temper, boding well for interested homebuyers, said Khater.
Rates rose from last week when they averaged 6.86%. Last year, rates were slightly lower than they are now, at 6.81% for a 30-year mortgage.
Buyers considering 15-year mortgages also saw higher average rates this past week, with fixed-rate mortgage rates increasing to 6.25% from 6.16% last week. This week's rates were nearly identical to rates last year, when they sat at 6.24%.
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"Sandwich generation" can more easily afford a home than other generations
Nearly every generation is struggling with the high cost of homebuying, but a sub-generation, known as the "sandwich generation" is getting help in their buying journeys, reported Realtor.com.
About 17% of Americans make up this generation, which consists of those taking care of their children and parents or grandparents at the same time.
"Unfortunately for home shoppers, affordability is still a big challenge in the current housing market, but for the Sandwich Generation, family support is providing a helping hand when it comes to finances," Laura Eddy, the VP of research and insight for Realtor.com, said.
Of those Realtor.com polled, 30% reported that the financial help they get from older family members living with them has helped them buy a home. However, another 30% said the opposite, that having additional live-in family members stopped them from taking on a mortgage.
"It's not uncommon for people to find themselves taking responsibility for the home of an aging or deceased family member and ultimately inheriting the home after they pass," Kendall Bonner, a Realtor.com housing expert, said.
"With today's increased home equity and the state of current lending rates, it can be an extremely helpful way to get into the housing market, especially if they are not currently a homeowner. Real estate continues to be the most consistent method for building generational wealth," Bonner said.
To see if you qualify for a mortgage based on your current credit score and salary, visit Credible, where you can compare multiple mortgage lenders at once.
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Housing prices reach new all-time high
Both interest rates and housing prices rose again recently, creating an unaffordable market for many prospective buyers.
The average sale price for a home in the U.S. is $397,954, a 4.9% change year-over-year, a Redfin report found. This is the largest increase in price since March. Asking prices started slightly higher in June at $409,975, on average, which is the biggest increase since October 2022.
Due to sky-high prices and rising interest rates, pending sales are down 4.6%, with just 87,160 sales in June. Sales may be down, but listings are up, largely due to the season. New listings hit 100,989, a healthy 9.9% increase year-over-year, and the largest increase in two months.
A few cities in Texas did see small price drops year-over-year, according to Redfin. The average price of a home in Austin, Texas dropped by 2.1%, while Dallas prices dropped by 1.5%. Prices in San Antonio also dropped, but by a small 0.2%.
You can explore your mortgage options in minutes by visiting Credible to compare rates and lenders.
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