Mortgage rates topped 3% for the first time since late June, as expectations for higher interest rates overall increased after comments from the Federal Reserve chairman this week.
The rate on the 30-year fixed mortgage — the most common home loan for homebuyers — increased to 3.01% this week, according to Freddie Mac, up from 2.88% last week.
That’s the highest level since the week of June 24 when rates stood at 3.02% and the largest one-week increase since late February.
“Mortgage rates rose across all loan types this week as the 10-year U.S. Treasury yield reached its highest point since June,” Freddie Mac Chief Economist Sam Khater said in a statement. “Many factors led to this increase, including the Federal Reserve communicating that it will taper its support of the capital markets, the broadening of inflation and emerging energy supply shortages which compound other labor and materials shortages.”
The higher rate weighed on mortgage applications, according to the Mortgage Bankers Association. The trade group’s gauge of mortgage activity decreased 1.1% on a seasonally adjusted basis from one week earlier. Measures for both purchase and refinance mortgage applications fell 1% from a week earlier.