Instant Reaction: Mortgage Rates, July 13, 2023

The 30-year fixed rate increased further this week to 6.96% from 6.81% last week, hitting the highest level in 8 months. For home buyers, the rate jump means a monthly payment of $2,126 for the typical single-family home. The typical payment is up more than $280 since July 2022.

For those saving for a downpayment, yesterday's inflation numbers show a positive story, which hopefully translates to lower mortgage interest rates this year. It may be easier today to save and pay down existing debt than it has been in the last year. Energy prices dropped, meaning a summer road trip could still happen even while saving for a new home.

If there is a decline in interest rates, as anticipated, the U.S. will need to continue to keep its foot on the gas pedal of new housing production, as home buyers will be ready to set up camp in their new homes.