In percentage terms, and this counts for borrowers accustomed to cheap rates, the current rise in mortgage rates is unprecedented.
Freddie Mac Mortgage Rates via St. Louis Fed, Mish Chart
The Biggest Mortgage Rate Fluctuations in History
- In 18 months, the year-over-year percentage change in rates increased from -27.8% to over 80.4%, a change of 108.2 percentage points.
- The December 2020 drop of 27.8% is the largest drop in history.
- The 80.4% year-over-year increase in June 2022 is the largest increase in history.
Percentage of monthly average mortgage rate
Freddie Mac Mortgage Rates via St. Louis Fed, Mish Chart
Highest rate in 11 years
5.37% is not a historically high rate, but it is the highest rate since 5.42% in June 2009.
Moreover, one cannot get anything close to this rate now. This is a Freddie Mac weekly average rate from the beginning of June and it is very outdated.
Mortgage News Daily Rates
Chart taken from Mortgage News Daily annotations by Mish.
As of June 21, the average mortgage rate was 6.07%, compared to 3.26% a year ago.
According to Freddie Mac, the average annual engagement rate for all of 2021 was 2.96%. Fares have now doubled.
New home sales plunge 22.5% in April, 16.6% from deep negative revisions
On May 24, I reported April new home sales fell 22.5%, 16.6% from deep negative reviews
New home sales have peaked this cycle and the bottom is nowhere in sight.
Sales of existing houses
Existing home sales courtesy of Trading Economics annotations by Mish
Existing home sales slip another 3.4% in May
Existing home sales fell for the fourth month of May. Sales are down 16.8% since January.
Sales of existing homes are recognized at closing, new homes at signing. May sales reflect March and April mortgage rates, not June.
Expect sales to get much worse.
For more, see Existing home sales skid another 3.4% in May, fourth month of decline
Note that the seventh largest US importer is cutting shipments in half, shipping rates are collapsing
With mortgage rates up 2.7 percentage points this year and doubling from the 2021 average, this fall has only just begun and with it the demand for property.