Phoenix residents Arin Lopez, 47, and Derek Swenson, 35, are kicking themselves for not buying a home earlier this year. With the 3% mortgage rate they were offered then, they would have had a monthly mortgage payment of $2,200 for a $550,000 home.
Today, in the wake of a series of jumbo rate raises by the Federal Reserve, lenders are quoting the couple an interest rate of 7.25%, which means that their monthly payments for a $550,000 house would be around $3,800 a month.
It’s part of the vicious cycle facing many of America’s 114 million renters today. The pandemic created a huge demand for more housing, which sent rents soaring, and contributed to rising inflation. That in turn motivated the Federal Reserve to raise interest rates to slow inflation,…