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Mortgage rates reach six-week high, but still expected to decline; Where home sales are headed in Virginia

The average long-term U.S. mortgage rate climbed to a six-week high this week, pushing up borrowing costs for homebuyers already facing the challenges of rising housing prices and a shortage of homes for sale.

The average rate on a 30-year mortgage rose to 6.69% from 6.6% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.13%.

Home loan borrowing costs have been mostly easing since late last year, after the average rate on a 30-year mortgage climbed to 7.79%, the highest level since late 2000.

As mortgage rates have come down, so have monthly payments on new home loans.

Many economists are projecting that mortgage rates will continue heading lower this year, though forecasts generally have the average rate on a 30-year home loan hovering around 6% by the end of the year.

If rates keep easing that should help boost purchasing power for prospective homebuyers this spring, traditionally the busiest period for home sales.

See where home sales are headed in Virginia.

Source: www.dailyprogress.com

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