Rising Mortgage Rates Push More Homebuyers to the Sidelines

Mortgage rates are climbing, creating another challenge for homebuyers already facing high home prices.

The average 30-year fixed mortgage rate is now around 6.7%, near a one-year high.

Local realtors Amie Arbid and Payal Patel say the higher rates are especially difficult for buyers who need financing, while cash buyers can avoid the added cost.

Economist Lawrence Yun, chief economist for the National Association of Realtors, says higher rates can limit how much home buyers can afford.

On a $440,000 national median-priced home, Yun estimates a buyer putting 10% down could face a monthly payment of about $2,560.

In Riverside County, where the median home price is around $660,000, that payment rises to roughly $3,800.

Yun says the future direction of mortgage rates could depend in part on oil prices.

While cash buyers continue to drive activity in the Coachella Valley's luxury market, rising rates could keep more would-be buyers on the sidelines.