More selling in U. The average contract rate on the popular year fixed mortgage hit 4 percent, according to Mortgage News Daily, a level most didn't expect to see until the middle of next year.

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Rates have now moved nearly a half a percentage point higher since Donald Trump was elected president. Damage control," said Matthew Graham, chief operating officer of Mortgage News Daily. Many hoped for a bounce last week heading into the long weekend and we obviously didn't get it.

Mortgage rates follow loosely the yield on the year Treasury bond.

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That yield on Monday hit the highest level since December, as investors flooded the stock market and pulled out of the bond markets. The runup on stocks is backed by a belief that the Trump administration will be a boon to the economy overall and the banking sector specifically.

Higher mortgage rates, however, will throw a wrench into an already shaky housing recovery.

Home prices have been rising dramatically in the past few months, largely due to a lack of homes for sale. During housing's recovery from the worst crash in history, historically low mortgage rates allowed prices to gain quickly and, more recently, to rise far faster than both income and employment growth.

Economists at the Mortgage Bankers Association are now predicting that rates will, "trend higher than we had previously forecast, which will more quickly decrease refis. Asia Europe Stocks Commodities Currencies Bonds Funds ETFs Investing Trading Nation Trader Talk Financial Advisors Personal Finance Etf Street Portfolio Watchlist Stock Screener Fund Screener Tech Mobile Social Media Enterprise Gaming Cybersecurity Tech Guide Make It Entrepreneurs Leadership Careers Money Specials Shows Video Top Video Latest Video U.

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