Mortgage rates rise at fastest clip in nearly 30 years — The average rate for a 30-year fixed-rate home mortgage climbed to 4.72 percent last week, mortgage giant Freddie Mac said Thursday, marking the highest level since the fall of 2018. This was no short-term spurt: Over the past three months, the rate has increased by 1.5 percentage points — the quickest jump since May 1994, according to Freddie chief economist Sam Khater. Some economists — and homebuyers — expect the upward trend to continue, given that Federal Reserve policymakers are poised to aggressively raise interest rates in the coming months in a bid to rein in the highest consumer price inflation in four decades.

MM chatted with Joel Kan, associate vice president of economic and industry forecasting at the Mortgage Bankers Association, about what it all means for the housing market going forward.

“Rising [mortgage] rates have certainly added to an already challenging market in terms of affordability, but our forecast is still for a pretty healthy purchase market in 2022,” Kan said. The reason: A combination of demographic pressures (from a glut of millennials seeking to buy their first homes) and short supply (the inventory of homes on the market remains historically low) will keep demand high, he says.

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