Mortgage rates have climbed above 7% for the first time in nearly two years, adding another hurdle for California homebuyers already facing high housing costs.<\/p>\n
Freddie Mac reported Thursday that the average rate on a 30-year fixed mortgage reached 7.03%, the highest level since January 2025. Rates have risen more than a full percentage point since briefly falling below 6% in February.<\/p>\n
In Sacramento, local mortgage brokers say borrowers are already seeing rates closer to 7.5%.<\/p>\n
For Raj Kumar and his family, the timing of their home purchase meant getting into their new house before borrowing costs potentially climbed even higher.<\/p>\n
As the family unpacked boxes, Kumar said the experience of buying a home has “been insane.”<\/p>\n
Cam Villa, a Natomas-based mortgage broker, has been watching the recent jump in rates.<\/p>\n
“It’s been a really big rise over the last five weeks,” Villa said. “So, first and foremost, we just eclipsed the 7%. Like, mentally, psychologically, that changes a whole part of the ballgame.”<\/p>\n
What 7% means for Sacramento buyers<\/p>\n
The median home price in Sacramento is about $533,000.<\/p>\n
For a buyer putting 20% down, a 7% mortgage rate would mean a principal-and-interest payment of roughly $2,800 a month on the remaining loan balance, before property taxes, insurance and other costs.<\/p>\n
That is substantially more than buyers would have paid when mortgage rates hit historic lows.<\/p>\n
Four years ago, mortgage rates briefly fell as low as 2.65%, and that same mortgage payment would be $1,100 a month. That difference is $1700 a month.<\/p>\n