Mortgage Rates Top 7.24% as Experts Warn of Storm Clouds Ahead

Mortgage rates just got a lot more expensive. The average 30-year fixed rate climbed to 7.24% on Sept. 16, up more than half a point over the past month, according to Mortgage News Daily — a jump that has housing economists warning of tougher months ahead for buyers and sellers alike.

The timing is notable because August itself was a pleasant surprise. Buyers shrugged off the fast-rising rates to deliver better-than-expected sales in the final month of the summer buying season. The California Association of Realtors reported a seasonally adjusted annualized pace of 269,620 home sales in August, up 2.4% from July and 1.4% from a year ago. The statewide median price reached $901,420 — up 1.6% from July and essentially flat year over year.

But the fine print is less cheerful. Sales remained below the 300,000-unit benchmark for the 47th consecutive month, the marker of a healthy market. In Southern California, the median price hit $900,000, up 2.9% from last year, while sales slid 4.8% year over year. Unsold inventory reached 3.7 months — the highest level in six months — and fewer than one in five households could afford the median-priced home in the second quarter.

"The recent rise in mortgage rates and continued economic uncertainty could create some headwinds as we move in the fall," said C.A.R. president Tamara Suminski. "At the same time, year-over-year gains show that demand is still there, especially among buyers who are prepared to move when the right home and opportunity come together." C.A.R. chief economist Jordan Levine added that if the Fed takes a more restrictive path, rates could stay elevated or move higher, "further challenging affordability and weighing on market activity this fall."

For the South Bay, the message is familiar but sharpened: prices are holding, sales are grinding, and borrowing costs are the binding constraint. Buyers who are ready — pre-approved, flexible on rate buydowns, and watching aging listings — still have a window before the seasonal slowdown fully sets in. Sellers should read the inventory trend and price for the market they have, not the one they remember.

Source: CalHomeNews — https://www.calhomenews.com/2026/09/19/a-bright-spot-in-a-four-year-sales-slump-in-august-but-with-storm-clouds-on-the-horizon/

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