Mortgage rates climbed higher above 7% this week, marking a 22-year high and shattering the American Dream for many.
The average 30-year mortgage rate jumped to 7.23% this week, up from last week’s 7.09%, according to Freddie Mac on Thursday. That is the highest rate point since June 2001 when rates were at 7.24%.
Today’s rate environment is bruising first-time homebuyers who are facing many other struggles, including high prices and minimal inventory. The resulting unaffordability is also increasing the wealth gap between those who own and those who remain stuck on the sidelines.
“It’s going to create a huge social divide,” Lawrence Yun, chief economist with the National Association of Realtors, told Yahoo Finance Live about mortgage rates. “Homeowners are smiling big, while the renters feel like their dream is out of reach, frustrated that other people are getting the housing wealth while they are left out paying higher rents each month.”
Many buyers have thrown in the towel.
The volume of mortgage applications for a home purchase was the smallest in 28 years last week, according to an index from the Mortgage Bankers Association released Wednesday.
Click here to read the full story from Rebecca Chen on Yahoo Finance.
