30- and 15-year mortgage rates haven’t been higher since October
Mortgage rates moved higher this week, according to Freddie Mac’s weekly survey released on Thursday, with the 30-year and 15-year fixed-rate mortgages reaching their highest levels in more than three months.
Upbeat economic news preceded the rate boost, said Frank Nothaft, Freddie Mac vice president and chief economist.
“The strong 3.5% annualized growth in the economy over the final quarter of 2006 occurred while inflation moderated. Solid economic growth and tepid inflation contributed to the Fed’s decision to leave the target short-term interest rate unchanged,” Nothaft said in a news release. The Federal Reserve also referred to “tentative signs of stabilization” in the housing market in its Wednesday statement, he added.
The 30-year fixed-rate mortgage averaged 6.34% for the week ending Feb. 1, up from last week’s 6.25% average. The mortgage’s average rate has not been higher since Oct. 26, when it averaged 6.40%. It averaged 6.23% a year ago.
The 15-year fixed-rate mortgage averaged 6.06% for the week, up from last week’s 5.98% average. The mortgage also hasn’t been higher since Oct. 26, when it averaged 6.10%. A year ago, the mortgage averaged 5.81%.
Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 6.04% for the week, up from last week’s 6.00% average. The hybrid averaged 5.87% a year ago.
One-year Treasury-indexed ARMs averaged 5.54% for the week, up from last week’s 5.49% average. The ARM is at its highest since Nov. 9, when it averaged 5.55%. It averaged 5.33% year ago.
To obtain the rates, the 30- and 15-year mortgages required payment of an average 0.4 point, while the 5-year ARM required 0.6 point and the 1-year ARM required 0.7 point. A point is 1% of the mortgage amount, charged as prepaid interest.
The volume of mortgage applications, including both refinancings and purchase loans, was also higher compared with the same week a year ago, up 0.7%.
Applications for loans to buy a home rose 1.3% on a week-to-week basis but were down about 6% compared with a year ago.
The latter decline mirrors in the decline in U.S. home sales, which are down about 8% from last year.
Applications for loans to refinance an existing loan increased 4.9% last week and were up about 11% compared with the same week a year earlier, according to the MBA.
Refinancings accounted for 47.4% of loan applications, off from 47.8% the previous week. That’s the smallest share in nine weeks.
The average rate for a 30-year fixed-rate loan rose to 6.29% from 6.22% the previous week. Rates have moved up by 0.31 of a percentage point in the past eight weeks.
The average rate for a 15-year fixed-rate mortgage, popular as a refinancing vehicle, rose to 6.01% from 5.93% the previous week.
The rate for a one-year adjustable-rate mortgage averaged 5.86%, down from 5.91% the previous week, the MBA’s data showed. ARMs accounted for 21.4% of loan applications, up from 20.3% the previous week.