The U.S. real estate market has begun to cool after two years of torrid growth, but soaring mortgage rates, punishing rents, and a shortage of available homes continue to thwart Americans on the hunt for affordable housing.
The latest bad news for would-be homebuyers came on Wednesday, when the Federal Reserve approved another major hike to its benchmark interest rate in a bid to fight inflation. The average 30-year fixed-rate mortgage hit a two-decade high of 7.08 percent last week, according to mortgage lender Freddie Mac, before easing slightly to 6.95 percent this week.
Lawrence Yun, chief economist for the National Association of Realtors (NAR), noted in a statement that the mortgage market had already priced in the latest move by the Fed. Mortgage rates could rise to 8 percent or more in late 2022 and early next year if high inflation persists, according to Lisa Sturtevant, chief economist for Bright MLS….