Higher rates are adding urgency to the U.S. homebuying frenzy.
With mortgages rates at a seven-year high, homebuyers are moving more quickly, Bloomberg reported. Homes sold last month went into contract after a median of 36 days on the market, a record speed in data going back to 2010.
The average rate for a 30-year fixed mortgage climbed to 4.61 percent, the highest level since 2011, Freddie Mac said in a statement Thursday. The rise boosted the monthly payment on a $300,000, 30-year loan has climbed to $1,540 — up from $1,424 in the beginning of the year, Bloomberg noted.
“This is what happens when the economy is strong,” Sam Khater, Freddie Mac’s chief economist, told Bloomberg. “All the higher-rate environment does is it either causes them to try and rush or look at different properties that are more affordable.”
Buyers are also seeing higher home prices. The national median home sale price jumped 7.6 percent in April, compared to a year ago, to $302,200, according to Redfin.
More than higher mortgage rates, lack of inventory is the concern for clients, Minneapolis-area Realtor Mary Sommerfeld told Bloomberg. “My buyers say they better get busy and buy before the interest rates go up any further,” she said. [Bloomberg] — Meenal Vamburkar