Positive economic news fueled the fourth consecutive week of rising mortgage rates, according to surveys conducted by Freddie Mac and Bankrate.com.

In Freddie Mac’s survey, the 30-year fixed-rate mortgage averaged 5.77 percent for the week ended today, up from last week when it averaged 5.73 percent. The average for the 15-year fixed-rate mortgage is 5.34 percent, up from last week when it averaged 5.32 percent. Points on both the 30- and 15-year averaged 0.5.

The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 5.27 percent this week, with an average 0.6 point, up slightly from last week when it averaged 5.26 percent. The one-year Treasury-indexed ARM averaged 4.46 percent, with an average 0.6 point, up from last week when it averaged 4.42 percent. The last time the one-year ARM was higher was the week ending July 19, 2002, when it averaged 4.5 percent.

“Although inching upwards, the average 30-year fixed-rate mortgage rate for the month of July was lower than the annual averages since our survey began in 1971,” said Frank Nothaft, vice president and chief economist at Freddie Mac. “And the most recent figures for housing sales are reflective of these low interest rates in the mortgage industry.

“Currently, we are experiencing a rather flat yield curve. As a result, ARMs mortgages will probably become less popular because the uncertainty of future monthly payments may outweigh the savings realized in the initial rate period.”

In Bankrate.com’s survey, mortgage rates increased slightly, rising for the fourth consecutive week. The average 30-year fixed-rate mortgage inched higher from 5.78 percent to 5.84 percent, according to Bankrate.com’s weekly national survey of large lenders. The 30-year fixed-rate mortgages in this week’s survey had an average of 0.38 discount and origination points.

The 15-year fixed-rate mortgage, popular for refinancing, increased from 5.39 percent to 5.45 percent. The average rate for the jumbo 30-year fixed-rate mortgage nudged higher from 6.01 percent to 6.03 percent. Adjustable-rate mortgages increased at a faster pace, with the average 5/1 adjustable-rate mortgage jumping from 5.4 percent to 5.49 percent, and the one-year ARM moving from 4.78 percent to 4.8 percent.

This monthlong rate rise is unusual because of what happened during the year previous, when the Fed kept raising short-term interest rates, but long-term rates fell. The prime rate went from 4 percent to 6 percent, while the average rate on a 30-year fixed mortgage dropped from 6.3 percent to 5.61 percent, according to Bankrate’s national survey.

The Fed didn’t want or expect long-term mortgage rates to drop while it was raising short-term rates. According to the conventional wisdom, long-term rates fell because the Fed’s rate increases were seen as anti-inflationary. Federal Reserve Board Chairman Alan Greenspan didn’t fully buy that theory, and he labeled the behavior of long-term rates a conundrum.

The following is a sampling of Bankrate’s average 30-year-mortgage interest rates this week in some U.S. metropolitan areas.

New York – 5.85 percent with 0.18 point

Los Angeles – 5.91 percent with 0.59 point

Chicago – 5.95 percent with 0.01 point

San Francisco – 5.92 percent with 0.34 point

Philadelphia – 5.7 percent with 0.44 point

Detroit – 5.86 percent with 0.25 point

Boston – 5.92 percent with 0.1 point

Houston – 5.78 percent with 0.75 point

Dallas – 5.83 percent with 0.59 point

Washington, D.C. – 5.7 percent with 0.55 point


What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription