Mortgage rates dip back below 7%

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Mortgage rates fell this week after surpassing 7% for the first time in 20 years last week

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 The 30-year fixed-rate mortgage averaged 6.95% in the week ending November 3rd, down from 7.08% the week before, 

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A year ago, the 30-year fixed rate stood at 3.09%. 

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 The rapid rise has been fueled by the Federal Reserve’s unprecedented campaign of hiking interest rates in order to tame soaring inflation

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The combination of the central bank’s rate hikes, investor’s concerns about a recession and mixed economic news has made mortgage rates increasingly volatile

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 The Fed announced yesterday it would raise its benchmark interest rate by another 75 basis points, the sixth rate increase this year and the fourth-consecutive hike of that size.

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 Following the Fed’s meeting on Wednesday, Chairman Jerome Powell said that the possibility of a “soft landing,” 

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In which the economy cools without crashing into a recession, has narrowed but it is still possible

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 Most homes are priced based on comparable properties that sold in the past six months, a period which does not capture today’s much-higher rates and buyers’ inability to afford them

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 With household incomes lagging inflation and borrowing costs still rising, we can expect transactions to continue declining, and prices to continue to fall.