“Numerology” tries to find reality within various measurements of economic and real estate trends.
Buzz: Mortgage rates today would be at 8.9% if they were priced according to this century’s typical spread above the inflation rate.
Source: My trusty spreadsheet reviewed the relationship between the monthly average 30-year, fixed-rate mortgage (by Freddie Mac) and the inflation rate (12-month change in the Consumer Price Index).
Fuzzy math: Critics say the Federal Reserve’s inflation battle, which roughly doubled mortgage rates, has gone too far.
Topline
Since 2000, 30-year mortgages averaged 5% compared with 2.5% inflation – that’s a loan rate 2.5 percentage points above the cost of living.
January’s 6.4%