U.S. 30-year loan interest rates rose to 7.4%, the highest level in nearly three years

China News Service, Washington, October 8 (Reporter Sha Hanting) Data released by the U.S. housing finance institution Freddie Mac on the 8th local time showed that the average interest rate on 30-year fixed mortgage loans in the United States rose to 7.4%, the highest since November 16, 2023.

Data showed that the average interest rate on 30-year fixed mortgages in the United States rose to 7.4% on the same day. This data has increased for seven consecutive weeks. The figure was 7.28% a week ago and 6.3% a year ago.

U.S. mortgage interest rates are affected by factors such as the Federal Reserve's federal funds rate and the U.S. 10-year Treasury bond yield. Since the Federal Reserve raised interest rates on September 16, mortgage interest rates have continued to rise. The yield on the 10-year U.S. Treasury bond rose to 5.29% on the 8th, which was much higher than the 3.97% value before the war in Iran.

Since the beginning of this year, the average 30-year fixed mortgage interest rate in the United States dropped to a three-year low of 5.98% on February 26. Since then, it has shown an overall upward trend for several consecutive months due to the impact of the war in Iran.

According to calculations by the Associated Press, assume that a home buyer purchases a house priced at $400,000. The current 30-year mortgage interest rate of 7.4% is 1.42 percentage points higher than this year's lowest of 5.98%, which translates into an extra $376 per month in monthly payments.

US media believe that the rise in mortgage interest rates has weakened the purchasing power of potential home buyers, causing more potential home buyers to choose to wait and see. The downturn in the real estate market will continue.

According to data released by the Mortgage Bankers Association on the 7th, the number of mortgage loan applications (including home purchase loans or refinancing of existing mortgages) in the week ending October 2 decreased by 4.2% from the previous week. This data has declined for five consecutive weeks. (over)