Mortgage rates have continued to rise for the second consecutive week, with the average 30-year rate now standing at 7.17%, up from 7.1% the previous week. This marks a significant increase from last year's rate of 6.43%. Despite the rising rates, purchase demand remains steady, with sales of newly built homes seeing the biggest increase since December 2022.
15-year fixed-rate mortgages are also seeing an increase, with the average interest rate rising to 6.44% from 6.39%. Last year, 15-year rates were below 6% at 5.71%.
Home prices are still on the rise but at a slower rate compared to previous years. From 2020 to now, the average sale price has increased by 27.5%. However, home values are predicted to grow by only 1.9% this year, with home sales expected to dip due to rising interest rates. The limited number of listings is also contributing to the prediction of lower home sales, with new listings rising by 21% in February but dropping to just 4% in March.
On the insurance front, millions of homeowners are going without homeowners insurance due to high costs, particularly in areas like California, Texas, Florida, and Iowa where insurance rates are on the rise. These rate hikes are largely attributed to the effects of climate change, with more frequent severe storms leading to higher claims and losses for insurance companies.