The 30-year fixed-rate mortgage averaged 4.60% in the Sept. 13 week, according to Freddie Mac’s weekly survey. That was up six basis points during the week, and marked the third straight weekly gain. The 15-year fixed-rate mortgage averaged 4.06%, up from 3.99%. The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.93%, unchanged during the week.
Those rates don’t include fees associated with obtaining home loans.
Mortgage rates follow the 10-year U.S. Treasury note, which jumped over the past week on signs of wage growth, which signals faster inflation. A report from the Congressional Budget Office also found that the deficit had widened meaningfully, signaling more supply of government bonds would be necessary. More supply might dampen demand, and when bond prices fall, yields rise.
With little relief on the horizon, observers increasingly believe substantial shifts in housing policy are needed. One of the biggest issues facing the housing market is what’s often called “exclusionary zoning,” a phrase that admittedly makes eyes roll and many people tune out.
Exclusionary zoning simply means that powerful people in a community try to make it harder for newcomers to enter. That can mean limiting the number, or the type, of new homes that can be built — only single-family homes, no apartment buildings, for example. It can also mean setting rules for housing characteristics, such as specifying minimum yard sizes or minimum parking requirements.
Efforts like those are often referred to as “Not In My Backyard.” They’re intended to maintain the character of an existing community, a goal that’s both logical and clearly within the rights of existing residents. But it happens at the expense of people who can’t play by the same rules — often people of color and those at lower income levels.
And while it’s understandable that homeowners would seek to protect their investments by maintaining certain price levels in their communities, it’s also clear that such efforts exacerbate not only the housing crisis, but also social inequity.
Anti-Nimby (sometimes called “Yimby”) efforts have been gathering steam and may get a bigger boost from an unlikely source. The Department of Housing and Urban Development said in August that it wants to “streamline and enhance” a rule on desegregation. Revamping the “Affirmatively Furthering Fair Housing” rule would “provide for greater local control and innovation; seek to encourage actions that increase housing choice, including through greater housing supply,” HUD said.
A 2015 academic paper found that lowering regulations on building in high-density areas like New York and Silicon Valley would boost U.S. GDP by nearly 10%. As the noted scholar Edward Glaeser wrote, “Whether these exact figures are correct, they provide a basis for the claim that America’s most important, and potentially costly, regulations are land use controls.”
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