📺 Stream EntrepreneurTV for Free 📺

U.S. Mortgage Rates Surge to 7.49%, Posing New Challenges for Homebuyers — But Shopping Around for Rates Could Lead to Thousands in Savings As mortgage rates continue to rise, so do median home sale prices.

By Madeline Garfinkle Edited by Jessica Thomas

Key Takeaways

  • Mortgage rates in the U.S. have surged to 7.49%, up from 7.31% the prior week.
  • The median home price continues to rise, surpassing $400,000 for the third consecutive month.
entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

Mortgage rates in the U.S. surged to 7.49% this week, up from 7.31% the week before, Freddie Mac reported on Thursday — making homeownership an even more distant dream for potential homebuyers. A year ago, the interest rate for a 30-year fixed mortgage stood at 6.66%.

Mortgage rates have spiked as a result of the Federal Reserve's efforts to curb inflation, which has driven up the 10-year Treasury yield, Freddie Mac added, a crucial determinant of mortgage rates.

The increased cost of mortgage financing, coupled with soaring home prices and lack of inventory, has made homeownership out of reach for millions of Americans. Last month, The National Association of Realtors (NAR) found that home sales dropped 15.3% compared to the same period last year, while the median home sale price rose 3.9% from last year to $407,100 — the third month in a row where the median price surpassed $400,000.

"Home prices continue to march higher despite lower home sales," NAR chief economist Lawrence Yun said in the report. "Supply needs to essentially double to moderate home price gains."

Related: 'There's This Fear That Everything Will Crash': Home Prices Are Falling, But There's Still a Lack of Listings

The combination of limited supply and rising rates is resulting in a slowdown of sales but persistently high costs, Jiayi Xu, an economist at Realtor.com, told CNN.

"While declining pending home sales and new home sales signaled a slowdown in buyer activities, the increasing home listing prices and shorter days spent on market suggested that homebuyers are competing over the limited inventory," Xu told the outlet.

The rise in rates has led to significant variations in mortgage rates among lenders, with some offering rates close to 7% and others exceeding 8%, The Wall Street Journal reported. When rate volatility is high, lenders frequently adjust the rates they offer, meaning borrowers who seek multiple quotes can possibly get a lower rate.

According to a Freddie Mac report earlier this year, prospective buyers who shop around for different quotes have the potential to save thousands. If borrowers get at least four quotes they can save between $600 and $1,200 annually, the report found, while getting at least five can lead to $6,000 in savings over the span of the loan.

Related: The Inability to Afford a Down Payment Is Why Renters Keep Renting, According to a New Report from the Federal Reserve

Madeline Garfinkle

News Writer

Madeline Garfinkle is a News Writer at Entrepreneur.com. She is a graduate from Syracuse University, and received an MFA from Columbia University. 

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

These Coworkers-Turned-Friends Started a Side Hustle on Amazon — Now It's a 'Full Hustle' Earning Over $20 Million a Year: 'Jump in With Both Feet'

Achal Patel and Russell Gong met at a large consulting firm and "bonded over a shared vision to create a mission-led company."

Business News

These Are the 10 Most Profitable Cities for Airbnb Hosts, According to a New Report

Here's where Airbnb property owners and hosts are making the most money.

Side Hustle

How to Turn Your Hobby Into a Successful Business

A hobby, interest or charity project can turn into a money-making business if you know the right steps to take.


Want to Be More Productive? Here's How Google Executives Structure Their Schedules

These five tactics from inside Google will help you focus and protect your time.

Starting a Business

This Couple Turned Their Startup Into a $150 Million Food Delivery Company. Here's What They Did Early On to Make It Happen.

Selling only online to your customers has many perks. But the founders of Little Spoon want you to know four things if you want to see accelerated growth.