Mortgage rates climbed to fourth-month highs this week in response to positive economic news, according to surveys conducted by mortgage giant Freddie Mac and Bankrate.
In Freddie Mac’s weekly survey, the 30-year fixed-rate mortgage averaged 5.89 percent, with an average 0.6 point, for the week ended today, up from last week when it averaged 5.79 percent. The average for the 15-year fixed-rate mortgage this week is 5.23 percent, with an average 0.6 point, up from last week when it averaged 5.12 percent. Rates on one-year adjustable-rate mortgage averaged 3.69 percent, with an average 0.6 point, up from 3.65 percent last week.
“With economic news continuing to point to a growing economy, the financial markets are beginning to think about the likelihood of inflation again,” said Frank Nothaft, Freddie Mac chief economist.
“Although economic indicators thus far suggest March was an outstanding month, we still have to see how April will fare, especially with higher–although still moderate–interest rates,” Nothaft added.
Mortgage rates increased for the fourth consecutive week, reaching a four-month high, according to Bankrate’s survey of large lenders. Rates have increased more than half of one percentage point in the past four weeks.
The average 30-year fixed rate mortgage increased from 5.8 percent to 5.97 percent. The 15-year fixed rate mortgage climbed from 5.14 percent to 5.31 percent, and the one-year adjustable rate mortgage increased by 13 basis points to 3.79 percent. A basis point is one-hundredth of a percentage point.
Mortgage rates continue to trend higher in response to economic news. Reports of robust consumer spending at retail outlets in March coupled with a faster-than-expected rise in consumer prices have boosted odds of a Federal Reserve rate hike as early as August.
“Odds of a summer rate hike are mounting as all signs point to economic strengthening and higher rates,” said Bankrate senior financial analyst Greg McBride. “The jump in retail sales may not be sustained in the coming months, but inflation is poised to climb further, and evidence of job growth will remain key.”
The following is a sampling of Bankrate’s average 30-year-mortgage interest rates this week in some U.S. metropolitan areas.
New York – 6.02 percent with 0.18 point
Los Angeles – 6.01 percent with 0.44 point
Chicago – 6.03 percent with 0.15 point
San Francisco – 6.01 percent with 0.4 point
Philadelphia – 5.96 percent with 0.22 point
Detroit – 5.84 percent with 0.44 point
Boston – 6.04 percent with 0.1 point
Houston – 5.97 percent with 0.66 point
Dallas – 5.94 percent with 0.62 point
Washington, D.C. – 5.92 percent with 0.52 point
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