Get All Access for $5/mo

Mortgage Rates Are Above 6 Percent For The First Time Since 2008 As the Fed attempts to tame rampant inflation, mortgage rates hit new highs.

By Madeline Garfinkle

Opinions expressed by Entrepreneur contributors are their own.

For the first time since 2008, mortgage rates surpassed six percent this week, as the Fed continues its efforts to bring down inflation.

The rate is nearly double what it was nine months ago, according to data by Freddie Mac.

The spike in mortgage rates comes after the Bureau of Labor Statistics reported less than promising news regarding the consumer price index. The CPI for housing rose 0.7% in August and showed an increase of 6.2% annually — the largest increase since 1990.

"Mortgage rates at or above 6 percent is likely the new reality and prices will have to adjust," said Lisa Sturtevant, chief economist with Bright MLS, told The Washington Post. "Relatively strong demand and still-low inventory will continue to support stable or growing prices in most markets, but gone are the days of seeing offers tens or even hundreds of thousands of dollars over asking price. In some places, particularly high-cost markets and places where prices have grown fastest over the past two years, we could see year-over-year price declines."

Related: How Entrepreneur Millionaires Prepare for a Recession, According to a Former Wall Street Trader

As mortgage rates have steadily increased since June, the housing market has cooled from its astronomical highs. In July, home sales fell for the sixth consecutive month. With the new rate, the market is likely to continue declining.

"Mortgage rates have gone up four weeks in a row because of investors' concerns about inflation," said Holden Lewis, home and mortgage expert at NerdWallet, per The Washington Post. "Their worries are warranted, as we learned this week that inflation ran hotter than expected in August, as reflected in the consumer price index. That news boosted mortgage rates higher — a phenomenon that will be reflected in next week's rates."

Related: The Real-Estate Game Is Changing Fast. Are You Ready to Win?

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.

Editor's Pick

Business Solutions

Increase Productivity with This Microsoft 365 Subscription, Now $25 Off

It can make the entrepreneur life a lot easier.

Business News

Apple Pay Later Is Ending. Here's What's Taking Its Place.

The program was available for less than a year.

Leadership

This Artist Answered a Businessman's 'Powerful' Question — Then His Work Became 'the Poster Child for Juneteenth': 'Your Network Really Becomes Your Net Worth'

Reginald Adams was the executive director of a Houston-based art museum for more than a decade before he decided to launch his own public art and design firm.

Leadership

Harvard Business School Professor Says 65% of Startups Fail for One Reason. Here's How to Avoid It.

Team alignment isn't nice to have -- it's critical for running a successful business.

Business News

Here's What Companies Are Open and Closed on Juneteenth 2024

Since it became a holiday in 2021, Juneteenth has been recognized by some major corporations as a paid day off.

Growing a Business

I Hit $100 Million in Annual Revenue by Being More Transparent — Here Are the 3 Strategies That Helped Me Succeed

Three road-tested ways to be more transparent and build relationships that can transform your business — without leaving you feeling nightmarishly over-exposed.