Two weeks ago, mortgage rates have surged, with the average rate for a 30-year fixed mortgage reaching 7.22%, the highest since early November. This increase is partly due to the rise in the yield on the 10-year Treasury, driven by a robust employment report from ADP. Federal Reserve Chairman Jerome Powell's remarks suggesting further interest rate hikes also contributed to the upward trend.
Within just one week, the 30-year fixed mortgage rate has climbed by 31 basis points, resulting in a significant impact on monthly payments for homebuyers. For example, a $400,000 mortgage now requires a monthly payment of $2,720 compared to $2,637.
The higher mortgage rates have created a situation known as the "golden handcuff effect" for sellers. Many homeowners currently enjoy historically low interest rates below 4% or even 3%, making them reluctant to sell and lose the advantage of their low-rate mortgage. This sentiment has contributed to a shortage of homes for sale, with new listings this year lagging behind last year's pace by 20%.
The combination of rising mortgage rates and homeowners' reluctance to give up their low-rate mortgages has resulted in a challenging housing market, impacting both buyers and sellers.
Trump: I want no more property taxes across the United States
7/4/2025 10:14 PMTrump's "Big, Beautiful" has $1.1 trillion in health cuts and 11.8 million losing care
7/3/2025 7:31 PMTrump’s Big, Beautiful bill passes the House
7/3/2025 7:27 PMGas prices haven’t been this low for the Fourth of July since 2021
7/3/2025 4:32 PM
Stay Updated
Subscribe to our newsletter for the latest financial insights and news.