Mortgage Rates Climb Above 6% for First Time Since 2008

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Mortgage rates are spiking to rates not seen in more than a decade.

This week and for the first time since 2008, mortgage rates climbed above 6% - that's about double the rate from just a year ago.

Dan Haugen and his wife are trying to sell their Milpitas home after buying another one in Washington state. It was a deal, but Haugen said they waited too long to lock in a rate.

"With everything going up we decided we needed to make the move now before interest rates got more out of control," Haugen said. "We have a house twice the size and half the price, but the interest rates are driving affordability out the window."

The jump in mortgage rates means if someone purchased a million dollar home now compared to Jan. 1, they would be paying $1,400 more a month in interest.

"We're seeing some buyers who are delaying their purchase decision," said Sandy Jamison, a broker and owner of Tuscana Properties.

Meanwhile, there is still a lack of inventory, especially in the Bay Area.

San Jose's housing crisis is the worst of any major United States city due to its low inventory, according to the latest survey from the internet services company ANGI.

The San Jose metro area has 20% fewer homes on the market compared to last year. San Francisco comes in third on the list.

"Buyers are often expecting that the prices are going to drop whenever the interest rates go up, but historically if you look at the last seven times interest rates went up, prices still went up," Jamison said.

Realtors, however, said there are still reasons to buy now.

"We're actually into a period where consumers are able to buy properties with contingencies," said Brett Caviness, Silicon Valley Association of Realtors president. "Early this spring it was common to see 15 to 20 offers per property. Now we're experiencing one, two, maybe three offers."

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