by Risk calculated on 25/09/2022 11:58:00
Friday, the average The 30-year mortgage rate reaches 6.7% for zero points and higher level scenarios. This is the highest rate in 14 years and is close to the highest rate in over 20 years (over 6.76% will be the highest since the start of 2002).
Here is a chart showing the 30 year rate using Freddie Mac PMMSand MND for last week.
Click on the graphic to enlarge the image.
It’s a graphic from Mortgage News Daily (MND) showing 30-year fixed rates from three sources (MND, MBA, Freddie Mac) over the past 5 years.
The following graph shows the year-over-year change in principal and interest (P&I) assuming a fixed loan amount since 1977. Currently, P&I is up about 52% year-over-year another for a fixed amount (this does not take into account the evolution of real estate prices).
This is above the previous record increase of 50% in 1980. This assumed a fixed loan amount – if we add the year-on-year increase in property prices, payments would increase around 65% year-on-year for the same house.
This is one of the reasons I argued in my real estate newsletter Housing: don’t compare the current housing boom to the bubble and bustLook instead to the period 1978 to 1982 for the lessons.