(CNN) Mortgage rates continued to rise this week, reaching their highest level in more than a decade.
The 30-year fixed-rate mortgage averaged 5.11% in the week ending April 21, up from 5% the week before, according to Freddie Mac. It is the seventh consecutive week of increases and is significantly higher than the 2.97% average this time last year.
The last time rates reached this level was in April 2010 when they hit 5.21%, according to Freddie Mac.
"While springtime is typically the busiest home buying season, the upswing in rates has caused some volatility in demand," said Sam Khater, Freddie Mac's chief economist. "It continues to be a seller's market, but buyers who remain interested in purchasing a home may find that competition has moderately softened."
Buyers have been scrambling to get a home before rates rise too much. Those who weren't able to lock in a lower rate are finding themselves unable to afford the much higher payment on today's homes, said George Ratiu, Realtor.com's manager of economic research. That is starting to show in the sales numbers, with March's existing home sales down 2.7% from February -- even as prices hit an all-time record.
More affordable, entry-level homes are also harder to find because there are so few on the market. The combination of tight inventory and rising rates is taking a toll on sales in the middle of the market, too, he said.
"With the cost of financing a home about 40% higher than a year ago, demand for homes is visibly cooling, as many first-time buyers find themselves unable to qualify for a mortgage on a home that meets their needs," Ratiu said.
This week's rate increase follows the continued surge in the 10-year Treasury, which crossed the 2.8% mark for the first time since December 2018, said George Ratiu, Realtor.com's manager of economic research.
The Federal Reserve does not set mortgage rates, but its actions influence them indirectly. US Treasury bonds -- particularly the 10-year Treasury -- are a bellwether for fixed-rate mortgages. When 10-year Treasury yields go up, mortgage rates tend to move higher, too.
And mortgage rates are expected to continue to rise, said Ratiu. The Fed is expected to act more aggressively to rein in high inflation in upcoming months and it is widely expected the central bank will raise interest rates by 50 basis points at its next meeting in May.
"The Fed's intent of cooling demand seems to be working, leading housing markets toward a much-needed balance," said Ratiu.