(CNN) -- Mortgage rates climbed above 5% again, after dipping below that threshold for the first time in months a week earlier. While the volatility in mortgage rates remains, there are signs that the housing market is starting to stabilize.
The 30-year fixed-rate mortgage averaged 5.22% in the week ending August 11, up from 4.99% the week before, according to Freddie Mac. That is significantly higher than this time last year when it was 2.87%.
Rates rose sharply at the start of the year, hitting a year high of 5.81% in mid-June. But since then, concerns about the economy and the Federal Reserve's mission to combat inflation have made them more volatile.
"Although rates continue to fluctuate, recent data suggest that the housing market is stabilizing as it transitions from the surge of activity during the pandemic to a more balanced market," said Sam Khater, Freddie Mac's chief economist.
Earlier this week, the Consumer Price Index for July indicated the rate of inflation had started to slow, mainly due to lower energy costs. Housing, which comprises roughly a third of the basket of goods and services the CPI tracks, moderated slightly last month but still remains high.
One reason home prices keep climbing is a lack of available homes for sale. "Supply remains fairly tight across most markets," said Khater. "The consequence is that house prices likely will continue to rise, but at a slower pace for the rest of the summer."
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