Mortgage interest rates are rising again due to election volatility

On By Littum

Mortgage rates rose for the sixth week in a row, trailing Treasury rates as they edged higher through the presidential election.

The average 30-year fixed-rate mortgage rose to 6.79% through Wednesday, up from 6.72% a week earlier, according to Freddie Mac data. The average 15-year fixed-rate mortgage was largely unchanged at 6% from 5.99%.

Mortgage rates typically mirror 10-year Treasury yields, which rose sharply in recent weeks as traders grew more confident that former President Donald Trump would win Tuesday’s election and implement inflationary policies like tariffs.

Read more: Home loan interest rates are still rising – is it a good time to buy a house?

Bond yields rose another 16 basis points on Wednesday after Trump’s victory, before giving back some of their gains on Thursday to yield around 4.36%.

The Federal Reserve is expected to cut interest rates this afternoon, a move that is unlikely to affect mortgage rates in the coming weeks.

Even so, many housing market experts now expect mortgage rates to remain higher for a longer period of time. Lisa Sturtevant, chief economist at Bright MLS, said she still expects rates to fall from current levels but believes they will be volatile and could remain above 6% throughout next year.

“Prices are likely to remain a little bit more elevated than we might have expected,” Sturtevant said.

Higher rates also cooled housing activity for a sixth straight week. Applications to buy a home fell 5% from a week earlier, while refinances fell 19%, according to the Mortgage Bankers Association.

“Clearly, purchase demand is very sensitive to mortgage rates in the current market environment,” Sam Khater, Freddie Mac’s chief economist, said in a statement. “As soon as the rates started to rise in early October, the purchase applications fell, and over the last month they have fallen 10 percent.”

Read more: Mortgage and refinance interest rates today, November 7, 2024: 30-year interest rates are above 6.75%

Claire Boston is a senior reporter for Yahoo Finance covering housing, mortgages and home insurance.

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