Mortgage rate trends continue on their roller-coaster with no clear direction. In April, rates for 30-year fixed mortgages in the Northeast began the month at 4.42%, and ended the most recent week at 4.33% after two consecutive weeks of sharp declines. This compares to an average rate of 3.40% one year ago, or 93 basis points higher. Rates also increased for all other mortgage products in the Northeast Region this week.
That today's mortgage rates are about 1% (100 basis points) higher than a year ago, has caused a corresponding decline in homebuyer purchasing power. This is because every 1% rise in rates has the same effect on monthly mortgage payments as a 9% increase in home prices.