We saw mortgage interest rates continue to trend higher in the last 30 days. The recent change will cost new borrowers another $13.50 per month for every $100,000 borrowed. Average U.S. rates for 30-year fixed rate mortgages were at 3.69% as of this week. Last month at this time, they were sitting at 3.45%. Of course, both are historically low.
Recent forecasts for changes in interest rates have generally been slightly upward. While there will likely be upward pressure, it is hard to imagine them settling too much higher given the continuing uncertainty in the overall economy. Regardless of any movement we see, we will continue to be considerably lower than the long-term average mortgage interest rates in our country.
While it is hard to believe in today’s environment, the long-term average is still almost 8%. When you compare monthly payments at today’s rates versus the long-term average, homeowners are currently saving about $260 per month per $100,000 borrowed. That makes mortgaging today’s homes considerably more affordable than historic averages.
Mortgages are also somewhat more expensive now than they were last year at this time. The average increase in monthly payments per $100,000 borrowed with a 30-year fixed price mortgage is around $37 per month over the last year. If you max out a conventional mortgage, that means your monthly payment will be around $240 more per month now than it would have been in February of 2021.