The average interest rate on the most popular US home loan jumped to its highest level since 2009 last week, and demand for mortgages rose for a second consecutive week.
- The average contract rate on a 30-year fixed-rate mortgage rose to 5.53% in the week ended May 6 from 5.36% a week earlier.
- It has now jumped 242 basis points from 12 months ago, the sharpest rise in years, as the US Fed tightens financial conditions to try to hurt demand across the economy.
- The housing market is considered a rate-sensitive sector, and Fed policymakers are looking to offset some of the current double-digit annual price growth.
Mortgage applications expanded last week for the second week in a row. Purchase Composite Index rose 4.5% from a weak earlier.
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Source: MBA
