Mortgage rates climbed for the second consecutive week on news that the economy may soon be improving, according to surveys conducted by mortgage buyer Freddie Mac and Bankrate.
In Freddie Mac’s weekly survey, the 30-year fixed-rate mortgage averaged 5.82 percent for the week ended today, up from last week when it averaged 5.72 percent. The average for the 15-year fixed-rate mortgage this week is 5.24 percent, also up from last week when it averaged 5.12 percent. Points on both the 30- and 15-year averaged 0.6.
One-year Treasury-indexed adjustable-rate mortgages averaged 4.08 percent this week, with an average 0.6 point, up from last week when they averaged 3.97 percent.
“The financial market thinks we’ve passed the ‘soft patch’ in the economy, which would translate into stronger growth in the coming months,” said Amy Crews Cutts, Freddie Mac deputy chief economist. “Stronger growth means a greater threat of inflation, and that means interest rates will start to rise in response to the threat.
“That said, today’s rates are still a great bargain compared to even just a few years ago when long-term mortgage rates astounded the industry by falling to about 7 percent and even lower. Better yet, our current forecast calls for rates to remain at low levels through the end of next year.”
Fixed mortgage rates have increased for the second week in a row, with the average 30-year fixed-rate mortgage rising from 5.75 percent to 5.84 percent, according to Bankrate.com’s weekly national survey of large lenders. The average 30-year fixed-rate mortgage has increased from 5.71 percent two weeks ago, Bankrate reported. The 30-year fixed-rate mortgages in this week’s survey had an average of 0.35 discount and origination points.
The 15-year fixed-rate mortgage popular for refinancing increased also, from 5.14 percent to 5.24 percent. The average rate for the jumbo 30-year fixed-rate mortgage climbed back above the 6 percent mark, from 5.97 percent to 6.04 percent, while the average one-year adjustable-rate mortgage dipped from 4.21 percent to 4.13 percent.
Mortgage rates have fallen in recent months as the bond market rallied on economic pessimism. Rates have increased in the past couple of weeks as bond investors have taken profits from the rally, with bond yields rebounding. Bond prices and yields move inversely to one another, and mortgage rates are closely related to yields on long-term government bonds. However, fixed mortgage rates are still very attractive, remaining below the 6 percent threshold.
The following is a sampling of Bankrate’s average 30-year-mortgage interest rates this week in some U.S. metropolitan areas.
New York – 5.88 percent with 0.06 point
Los Angeles – 5.86 percent with 0.58 point
Chicago – 5.92 percent with 0.03 point
San Francisco – 5.86 percent with 0.37 point
Philadelphia – 5.82 percent with 0.31 point
Detroit – 5.8 percent with 0.25 point
Boston – 5.89 percent with no points
Houston – 5.77 percent with 0.79 point
Dallas – 5.8 percent with 0.51 point
Washington, D.C. – 5.76 percent with 0.61 point
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