A sudden spike in mortgage rates in March has erased six months of progress, adding more than $40,000 to the life of a typical loan for Phoenix homebuyers and threatening to cool the Valley real estate market.
In a single month, rates jumped from 6% to 6.38%. The 38-basis-point jump is the largest monthly increase in at least two years and the 10th largest in a decade.
For the current median home value in Phoenix, every one-hundredth of a point adds about $3 to a monthly payment on a 30-year fixed mortgage. The March spike adds $112 to a monthly mortgage payment, totaling more than $40,000 over the life of the loan.
The sudden increase hits the brakes on a market that was starting to move, though data shows luxury homes in certain Valley ZIP codes are still seeing rising prices and have a higher tolerance for rate pain.
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