Mortgages have gotten a little more expensive this week – with the emphasis on “little”. Freddie Mac said Thursday that the average interest on a 30-year fixed-rate mortgage was back to 3%, with charges of 0.6%. It’s still incredibly low by historical standards. These low rates in turn encourage buyers to borrow more money to pay the rising prices.

The average purchase loan amount rose to $ 411,400 last week, according to the Mortgage Bankers Association, the highest since February. The average loan for a new home surpassed $ 377,000 last month, a record high.

“We have seen very hot house price appreciation across the country – double digit nationally,” said Len Kiefer, deputy chief economist at Freddie Mac. “This puts pressure on the size of the loans because to buy a house at a higher price, you will have to borrow more money.”

MBA forecasting manager Joel Kan said the increase was in part due to the types of homes people are buying. The pandemic has led many newly remote workers to seek larger homes in the suburbs, with more outdoor space.

“These owners are usually still in paid employment, might have higher incomes, etc.,” Kan said. “Maybe they could afford a little more.”

And lenders make it easier for them to borrow. The MBA Mortgage Availability Index increased nearly 5% last month for conventional loans and 7% for jumbo loans.

“It’s really a function of the fact that our economy is improving, the job market is improving, and lenders are feeling a little more confident,” said Odeta Kushi, deputy chief economist at First American, a title insurance company.

Borrowers still need good enough credit to qualify for a mortgage, she said. The median credit score for new mortgages was 788 in the first quarter of this year, according to the Federal Reserve Bank of New York, up from 773 in the same period last year.

Even as loan balances increase, low mortgage rates have kept monthly payments relatively affordable, said Michael Neal, senior research associate at the Urban Institute. The risk of larger mortgages – and looser lending standards – kicks in if prices suddenly drop.

“For those who have recently obtained a mortgage, they have had less time to benefit from the appreciation in house prices, which increases the likelihood that they are underwater,” said Neal.

Most analysts don’t expect prices to drop anytime soon, although a significant increase in mortgage rates could slow price growth.

“It will be years before we can add enough supply to the market to achieve a balanced market,” Kushi said. “We expect house prices to continue to remain positive.”