Rates had fallen in July and early August as recession fears took hold. But Powell's comments during a speech last Friday refocused investors' attention back on the central bank's fight against inflation, pushing rates higher.
This is likely to further slow home sales and put downward pressure on prices.
"The increase in mortgage rates is coming at a particularly vulnerable time for the housing market as sellers are recalibrating their pricing due to lower purchase demand," he said.
Mortgage rates climbed after the 10-year US Treasury climbed back to levels not seen since June.
The Federal Reserve does not set the interest rates mortgage borrowers pay directly, but its actions influence them. Instead, mortgage rates tend to track 10-year US Treasury bonds. As investors see or anticipate rate hikes, they often sell government bonds, which sends yields higher and, with it, mortgage rates.
"Financial markets continue to react to the Federal Reserve's firm commitment to monetary tightening in order to bring inflation closer to the 2% mark," said George Ratiu, Realtor.com's manager of economic research.
As a result, he said homebuyers can expect mortgage rates to stay in the 5% to 6% range over the next few months. A combination of still-high inflation and the Fed's increasing borrowing costs will keep them elevated.
A year ago, a buyer who put 20% down on a median priced $390,000 home and financed the rest with a 30-year, fixed-rate mortgage at an average interest rate of 2.87% had a monthly mortgage payment of $1,294, according to numbers from Freddie Mac.
Today, a homeowner buying the same-priced house with an average rate of 5.66% would pay $1,803 a month in principal and interest. That's $509 more each month, according to numbers from Freddie Mac.
"As we move into the fall, and the pace of sales slows even further, some buyers may find discounts growing larger, offering opportunities that fit within their budgets," he said.