Us mortgage rates rise as sales fall

US mortgage rates are rising as property sales fall.

Mortgage rates for 30-year fixed mortgages rose again for the second week in a row, according to Zillow, with the site's Mortgage Marketplace offering borrowers rates of 4.18 per cent, up from 4.14 per cent seven days earlier.

"Last week, rates rose briefly when comments by Janet Yellen, the new Federal Reserve Chair, ended speculation that the Fed might delay the winding down of its stimulus program due to recent weak economic data," said Erin Lantz, director of mortgages at Zillow. "During this holiday-shortened week with limited economic data scheduled for release, we expect rates will continue to follow the gradual upward path of the past two weeks."

Indeed mortgage rates are expected to climb above 5 per cent by the end of the  year by the National Association of Realtors, which will continue to reduce the affordability of US property, despite new housing supply helping to moderate price growth.

While mortgage rates have now risen approximately a full percentage point since its record lows of one year ago, existing home sales have fallen, according to the NAR, as buyers are deterred from increasingly expensive costs.