The average long-term mortgage rate in the United States increased once again this week, reaching the highest point since July.
The benchmark 30-year fixed mortgage rate rose slightly to 6.93% from 6.91% the previous week, according to data from Freddie Mac. This figure has grown from the 6.66% rate seen a year ago, marking four consecutive weeks of increases.

This rise in mortgage rates parallels an increase in bond yields, which lenders refer to when pricing mortgages. Notably, the yield on the U.S. 10-year Treasury has surged from 3.62% in mid-September to 4.66% in the current week.
Meanwhile, home prices continue to climb, further complicating the outlook for many prospective buyers.

The combination of high mortgage rates and escalating home prices has created significant barriers to homeownership. Despite a rise in sales of previously owned homes in November for the second month in a row, the housing market remains sluggish, with projections indicating it could be facing its worst year since 1995.
A report detailing December home sales is expected to be released later this month.

Interest rates have been on the rise since the Federal Reserve indicated last month its intention to limit rate cuts, forecasting only two increases this year instead of the previously expected four.
This cautious approach to rate adjustments comes as inflation continues to hover above the Fed’s target of 2%, even though it has decreased from its peak in mid-2022.
Economists are also expressing concerns over the potential inflationary impact of economic policies proposed by President-elect Donald Trump, particularly his plan to significantly raise tariffs on imports.

Additionally, the average rate for a 15-year fixed-rate mortgage, which is frequently chosen by those looking to refinance, also saw a small increase, climbing to 6.14% from 6.13%. This is the highest rate recorded since July and up from 5.87% a year ago, as reported by Freddie Mac.