(Bloomberg) -- Mortgage rates in the U.S. jumped to the highest level in six months.

The average for a 30-year, fixed loan was 2.97%, up from 2.81% last week and the highest since August, Freddie Mac data showed Thursday. Rates have climbed from the record low of 2.65%, reached in early January.

Historically low mortgage rates have fueled the housing market in the U.S., boosting buying power for home shoppers seeking properties in the suburbs. But as vaccines raise optimism about an economic recovery, and Treasury yields tick higher, increased borrowing costs threaten to derail the rally.

“When combined with demand-fueled rising home prices and low inventory, these rising rates limit how competitive a potential homebuyer can be and how much house they are able to purchase,” Sam Khater, chief economist at Freddie Mac, said in a statement.

The yield on 10-year Treasuries, a benchmark for mortgages, reached its highest level in about year this week.

Mortgage rates have below 3% since July. That, along with low inventory, has helped drive up real estate prices and pushed homeownership out of reach for many Americans.

The mortgage industry posted record profits in 2020, with a flood of Americans seeking loans to buy houses and looking to refinance debt. Last week, mortgage applications dipped to a nine-month low.

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