Mortgage rates in the US rise, sending 30-year average to 6.81%

[BOSTON] Mortgage rates in the US increased for the first time in four weeks. The average for 30-year, fixed loans was 6.81 per cent, up from 6.76 per cent last week, Freddie Mac said on Thursday (May 15).

High mortgage rates are weighing on would-be homebuyers who also may be wrestling with concerns about the direction of the economy. Borrowing costs have largely tracked traders’ response to US President Donald Trump’s on-again, off-again trade wars and tariffs that are widely seen as inflationary.

A key measure of consumer prices rose less than expected in April, a sign that business have not yet passed along tariff-linked costs to shoppers.

But given the uncertainty over how Trump’s policies will play out, the US Federal Reserve has indicated it expects to hold interest rates steady for the foreseeable future.

Data from Redfin suggest that homebuyers are waiting out the turmoil. Signed contracts for April – a month when the market generally heats up – were down 3 per cent from a year earlier, already seen as a low point.

There’s a silver lining for determined house hunters, according to Hannah Jones, a senior economic research analyst at Realtor.com.

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“For-sale inventory has reached its highest level in over five years, offering buyers more choices across many parts of the country,” she said. BLOOMBERG