The column argues homebuyers should not expect mortgage rates to fall soon, given high national debt, inflation, geopolitical energy shocks and heavy borrowing demand. The CPI rose 3.7% in September, and the MBA forecasts the 30-year fixed rate will average 7.3% in Q4 2026 and stay above 7% through 2027, with the Fed expected to raise short-term rates 0.25% in December and another quarter-point in early 2027. Redfin reported 1,510,784 sellers versus 928,892 buyers in September, 63% more sellers than buyers, the fewest buyers in its records dating to 2013. Pending home sales were the lowest since 2014 excluding the pandemic period, and 14.5% of pending deals fell out of escrow, the highest share on Redfin's record.
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Freddie Mac reported that the average rate on a 30-year mortgage reached 7.4% on October 8, the highest in nearly three years. The article illustrates that a retiree moving from a $300,000 loan at 3% to a $250,000 loan at 7.4% would pay about $466 more per month, or nearly $5,600 a year. The projected 3.5% Social Security COLA for 2027 would add only about $70 to a $2,000 monthly benefit, which is not enough to cover the difference. Other costs, such as property taxes, insurance, association fees, selling costs and extra taxable IRA withdrawals of $4,800 a year, can further strain the budget. The article suggests comparing full monthly costs, realistic sale proceeds, and alternatives such as a larger down payment, paying cash, or staying put to keep a low rate.
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The average 30-year fixed mortgage rate held steady at 7.40% this week, unchanged from last week, according to Freddie Mac, its highest since November 2023 and up from 6.27% a year ago. The 15-year fixed rate eased to 6.71% from 6.73%, ending a seven-week climb in the 30-year average. Rates have risen since late February, when the U.S. war with Iran began and pushed up oil prices and inflation, while the 10-year Treasury yield pulled back to 5.10% from its highest level since 2002. Home sales remain stalled, mortgage applications fell 2.7% last week per the MBA, and adjustable-rate loans reached 10.5% of applications, the highest in a year. Inflation data came in above expectations, and CME Group data show the odds of a December Fed rate hike rising to 64.6% from 49.9% a month earlier.
- Average long-term mortgage rate holds at 7.4%, remaining at high level
The average 30-year fixed mortgage rate held at 7.40% this week according to Freddie Mac, its highest since late 2023 and ending a seven-week climb; a year ago it was 6.27%. The 15-year rate eased to 6.71%. Rates have risen since late February, when the U.S. war with Iran began, lifting oil prices and inflation and pushing up Treasury yields; the 10-year yield pulled back from its highest level since 2002 but remains above its 3.97% pre-war level. Home sales remain stalled, and mortgage applications fell 2.7% last week. Hotter-than-expected consumer and wholesale prices could push the Fed to hike rates by December, with CME data showing 64.6% odds, while Fannie Mae projects the 30-year rate will average 7.4% in the final quarter of this year and 7.5% in 2027.
- Average long - term mortgage rate holds at 7 . 4 %, remaining at high level
- Meet the home buyers totally unfazed by 7% mortgage rates
- Rising mortgage rates and home prices sidelining buyers but now is the time to purchase , report says
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