Mortgage rates have recently surged, with the 30-year fixed rate increasing from 6.6% to 6.98%. Market experts predict the Federal Reserve will keep rates steady in the near term, though some anticipate possible cuts in June. The rise in mortgage rates has been linked to foreign investors selling U.S. bonds, consequently raising Treasury yields. The stakes are higher as foreign entities hold significant positions in U.S. mortgage-backed securities, influencing the real estate market amid uncertain economic conditions reflected in Fannie Mae's latest housing forecasts.
The recent increase in mortgage rates, climbing from 6.6% to 6.98%, is largely attributed to U.S. bond sales by foreign investors pushing Treasury yields up.
Melissa Cohn commented on the leveraged position of foreign investors in the mortgage market, stating they could derail the real estate market if they choose to act.
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