Mortgage rates in the U.S. go up for 7 straight week

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- Mortgage rates in the U.S. increased for a seventh straight week.

The average for a 30-year loan was 3.18%, down from 3.17% last week and the highest since June, Freddie Mac data showed Thursday.

The rates have increased from the record low of 2.65% and were reached in early January. This has made homes more expensive for buyers, many of whom have to stretch to afford a purchase as they compete for the slim supply of properties on the market.

The bidding wars, sparked by a frenzied demand for more space in the pandemic, are taking a toll. The National Association of Realtors index of the contracts to buy previously owned homes fell by the most since April, a month when lockdowns severely limited deals across much of the U.S.

While the purchase demand remains strong, the marginal buyer is experiencing the affordability squeeze arising from the increases in mortgage rates and house prices we 've seen in recent months, said Sam Khater, the chief economist at Freddie Mac in a statement.

The boom in refinancing also followed, reducing profits for the mortgage industry after a record year in 2020.

Borrowing costs could continue to rise, along with yields for the benchmark 10-year Treasurys as the fresh Federal stimulus and vaccination efforts boost optimism for an economic rebound.

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