Interest rates on long-term mortgages in the US rose to more than 7% this week, the highest point in nearly five months, making potential home buyers face higher financing costs for home purchases.

The Zhitong Finance App learned that according to data released by mortgage lender Freddie Mac (Freddie Mac) on Thursday (April 18), the average interest rate for 30-year fixed mortgages rose from 6.88% last week to 7.1%, compared to 6.39% a year ago. The rise in mortgage interest rates is causing borrowers to pay hundreds of dollars more each month. The US real estate market is still constrained by the small number of homes for sale and rising housing prices, which has undoubtedly increased the financial burden on buyers.

Sam Khater, chief economist at Freddie Mac, pointed out that as interest rates rise, buyers are considering whether they should buy homes before interest rates rise further or expect interest rates to fall later this year. Despite an increase in home purchase applications last week, it's unclear how many people can afford interest rates that may continue to rise in the future.

Since mortgage interest rates reached a high of 7.79% in October last year, interest rates on 30-year fixed mortgages have remained below 7%. This is because the market expects inflation to ease and the Federal Reserve may start cutting interest rates. Changes in mortgage interest rates are affected by various factors, including the bond market's reaction to the Federal Reserve's policy and changes in 10-year Treasury yields. These factors are all references used by lenders to set housing loan prices.

However, in recent weeks, due to better-than-expected employment and inflation data, the market's expectations for when the Federal Reserve will cut interest rates have changed, leading to an increase in bond yields. In particular, the yield on 10-year treasury bonds jumped to about 4.66% after senior Federal Reserve officials hinted that the main interest rate might remain stable for some time, the highest level since November last year.

Lisa Sturtevant, chief economist at Bright MLS, said that since the economy is still strong, the federal funds rate will not be lowered immediately, and mortgage interest rates are unlikely to face downward pressure. She anticipates that the average interest rate for 30-year mortgages will remain around 7% throughout the spring, and may drop to a medium to high level of 6% in the summer.

Furthermore, second-hand housing sales in the US also declined last month due to rising mortgage interest rates, even though the previous slowdown in interest rates boosted house sales in January and February. The Redfin report indicates that in an environment of continued high inflation, housing prices are still rising.

US chief economist Mark Fleming explained that rising mortgage interest rates not only affected the affordability of potential buyers, but also had an impact on the supply side, as rising costs associated with housing transactions made homeowners reluctant to sell their properties. He believes that if interest rates remain high, changes in life will be the main driving factor for people to move. Meanwhile, the cost of refinancing housing loans has also risen this week, with the average interest rate on a 15-year fixed-rate mortgage rising from 6.16% last week to 6.39%.