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Mortgage Rates Just Hit a 4-Month High

October 20, 2016

ME-Teardown Photos by Michael Williamson Neg#172397 9/13/05ME-Teardown Photos by Michael Williamson Neg#172397 9/13/05
Rising interest rates could hurt the housing market. Photo by The Washington—Getty Images

Interest rates on U.S. 30-year mortgages rose to their highest levels in four months in line with rising Treasury yields on a bond market sell-off spurred by speculation about reduced stimulus from global central banks, mortgage finance agency Freddie Mac said on Thursday.

The average 30-year mortgage rate was 3.52% in the week ended Oct. 20, Freddie Mac said in its latest mortgage rate survey. This was the highest level since the 3.56% recorded in the week of June 23.

“This is the first week in over four months that rates have risen above 3.50%. This month, mortgage rates seem to be catching up to Treasury yields and returning to pre-Brexit levels,” Sean Becketti, Freddie Mac’s chief economist, said in a statement.

Benchmark 10-year Treasury yields were at 1.74% early on Thursday, down more than 1 basis point (a tenth of a percentage point) on the day. On Monday, it reached 1.81%, which was its highest since June 2, Reuters data showed.