No. of Recommendations: 10
So mortgage rates inched past 7% for the first time since early 2025:
cnn.com - Mortgage rate tops percent...which is just more bad news on the affordability front. Obviously high mortgage rates directly affect the cost for new homeowners, since mortgage interest is one of the bigger expenses for home purchasers. But it also ends up freezing the housing market, since it creates a massive disincentive for most people to sell out of their current homes. The typical house that has a mortgage has a rate less than 4%.
So high rates end up both increasing direct costs and reducing the supply of houses on the market, as it becomes a better deal for most existing homeowners to just hang tight to their well-below-market mortgages.
