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This Is Why Homes Are Now Even Less Affordable for Most Americans

Avi Salzman

The average rate for a traditional 30-year mortgage just topped 5% for the first time since 2011, according to data released on Wednesday from the Mortgage Bankers Association. For mortgages of $453,100 or less, the average contract rate for 30-year fixed-rate mortgages hit 5.05% in the week that ended October 5. “Layering the price increases over the past few years on top of now higher mortgage rates, it puts a further affordability squeeze on would-be homebuyers,” wrote Greg McBride, chief financial analyst at Bankrate.com, in an email to Barron’s. “We’re already seeing the housing market losing some steam—slowing sales, slower pace of appreciation, longer time on market—and the move up in mortgage rates only compounds that.