Mortgage rates rose to 7.03% for 30-year fixed-rate loans on the afternoon of March 7 as the Federal Reserve continued its ongoing efforts to tame inflation in the U.S. economy, Realtor.com reports. Less than two months ago, near-6% interest rates motivated a wave of buyers to return to the for-sale market after months of stagnant activity, but experts now predict rates could hover within the 6% to 7.5% range during the spring market.
That uptick in borrowing costs comes along with a drop in available inventory, meaning home prices will also remain high as the housing market heats up during a seasonal shift.
Less than two months ago, there was speculation rates would fall below 6%. Buyers had returned to the market, and bidding wars had heated up again. But the higher rates could threaten the rebound.
“It will continue to be a damper on how much home shoppers can afford. Sellers are going to need to be mindful of that,” says [Danielle] Hale. “There are probably going to be fewer buyers in the market, and the buyers who are in the market probably won’t be able to bid as high as they would have over the last few years.”