In percentage terms, and that matters to borrowers used to cheap rates, the current rise in mortgage rates is unprecedented.

Mortgage rates from Freddie Mac via St. Louis Fed, chart by Mish

Largest Mortgage Rate Swings in History 

  • In 18 months, the year-over-year percentage change in rates went from -27.8 percent to positive 80.4 percent, a swing of 108.2 percentage points.
  • The December 2020 decline of 27.8 percent is the largest decline in history.
  • The June 2022 year-over-year rise of 80.4% is the largest rise in history.

Monthly Average Mortgage Rate Percent 

Mortgage rates from Freddie Mac via St. Louis Fed, chart by Mish

Highest Rate in 11 Years 

5.37 percent is not a high rate historically, but it is the highest rate since 5.42 percent in June 2009.

Moreover, one cannot get anything close to that rate now. That's a Freddie Mac weekly average rate from early June and it is very stale.

Mortgage News Daily Rates 

Chart from Mortgage News Daily annotations by Mish.

As of June 21, the average mortgage rate is 6.07 percent, up from 3.26 percent a year ago. 

According to Freddie Mac, the annual average commitment rate across all of 2021 was 2.96%. Rates have now doubled

New Home Sales Plunge 22.5% In April, 16.6% From Deep Negative Revisions

On May 24, I reported New Home Sales Plunge 22.5% In April, 16.6% From Deep Negative Revisions

New home sales have peaked this cycle and the bottom is nowhere in sight.

Existing Home Sales 

Existing home sales courtesy of Trading Economics annotations by Mish

Existing Home Sales Skid Another 3.4 Percent in May

Existing home sales declined for the fourth month in May. Sales are down 16.8 percent since January.

Existing home sales are recorded at closing, new homes at signing. May sales reflect March and April's mortgage rates, not June's.

Expect sales to get worse, much worse. 

For discussion, please see Existing Home Sales Skid Another 3.4 Percent in May, Down Fourth Month

Note that the Seventh Largest US Importer Cuts Shipments in Half, Shipping Rates Crash

With mortgage rates up 2.7 percentage points this year and doubling from the average for 2021, this bust is just getting started and with it the demand for goods.

This material is based upon information that Sitka Pacific Capital Management considers reliable and endeavors to keep current, Sitka Pacific Capital Management does not assure that this material is accurate, current or complete, and it should not be relied upon as such.

Feed news Join Telegram

Recommended Content


Recommended Content

Editors’ Picks

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD has lost its bullish momentum after having climbed above 1.0570 with the initial reaction to the US data in the American session and retreated toward the mid-1.0500s. On a weekly basis, the pair remains on track to close in positive territory. 

EUR/USD News

GBP/USD struggles to hold above 1.2300

GBP/USD struggles to hold above 1.2300

GBP/USD has edged lower following a jump above 1.2300 in the early American session on Friday. The market mood remains upbeat ahead of the weekend with Wall Street's main indexes posting strong daily gains on upbeat US data. 

GBP/USD News

Gold stays below $1,830 as US yields edge higher

Gold stays below $1,830 as US yields edge higher

Gold continues to fluctuate below $1,830 on Friday and looks to close the second straight week in negative territory. Fueled by the risk-positive market environment, the benchmark 10-year US Treasury bond yield is up more than 1% on the day, limiting XAU/USD's upside.

Gold News

Why Cardano could surprise over the weekend

Why Cardano could surprise over the weekend

ADA  set to close out the week with a gain on the workday trading week and over the weekend? Central banks signaled that the rate hike cycle is ending, meaning less stress and tight conditions for trading, opening up room for some upside potential with Cardano set to pop above $0.55 and test a significant cap.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Majors

Cryptocurrencies

Signatures