- The rate on the popular 30-year fixed-rate mortgage rose to 3.01%, according to Freddie Mac data released Thursday.
- It is the first time in six weeks that US mortgage rates have risen: Rates have been kept low by low yields on US Treasuries and near zero interest rates.
- Mortgage rates remain close to a record low and have fueled a strong rebound in the housing market. Still, economic uncertainty could derail the recovery in housing in the future.
- Read more on Business Insider.
US mortgage rates rose for the first time in six weeks and exceeded the key 3% level, but still remain near record lows.
The rate on the popular 30-year fixed-rate mortgage rose to 3.01%, according to Freddie Mac data released Thursday. Last week, the rate fell to 2.98%, the lowest on Freddie Mac’s records dating back to 1971. In June, the 30-year mortgage rate fell below 3% for the first time.
Mortgage rates, which track the performance of the 10-year US Treasury bond, have plummeted since March, when the coronavirus pandemic first hit world markets. When that happened, investors turned to the security of government bonds, pressing returns in reverse of the price.
Historically low rates have helped fuel a strong rebound in the housing market, one of the bright spots in the recovery from the coronavirus pandemic recession. In June, existing US home sales rose nearly 21%, the largest monthly gain in history, according to data released Wednesday by the National Association of Realtors.
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“While housing demand continues to pick up, the month-long slump in economic activity has led to a 10-year Treasury benchmark drop,” said Sam Khater, chief economist for housing and economic research at Freddie Mac , it’s a statement. “In the short term, this means that demand will continue thanks to near-record low mortgage rates.”
Still, there are potential risks ahead for the housing rebound as new cases of coronavirus increase in the U.S., forcing some states to pause or reverse plans to reopen.
“The most recent consumer spending data points to slow growth since mid-June,” Khater said. “The concern is that the pause in economic activity will keep unemployment high, leading to longer-term labor market problems.”
On Thursday, weekly jobless claims in the United States rose for the first time since March, adding to concerns about stubbornly high unemployment.
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