Fixed Mortgage Rates Reverse Course and Rise
Both 30-year fixed-rate mortgages (FRMs) and 15-year FRMs got more expensive over the past week, with 30-year FRMs rising two basis points to return to the 4.14% level of two weeks ago, and 15-year FRMs likewise adding two b.p. to…
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Freddie Mac released its weekly update on national mortgage rates on Thursday morning, showing a partial reversal of the recent trend toward falling interest rates.
Both 30-year fixed-rate mortgages (FRMs) and 15-year FRMs got more expensive over the past week, with 30-year FRMs rising two basis points to return to the 4.14% level of two weeks ago, and 15-year FRMs likewise adding two b.p. to rise to 3.23%. One year ago, 30-year FRMs averaged 3.91%, and 15-year fixed-rate mortgages averaged 3.03%.
Adjustable-rate mortgages (ARMs), on the other hand, got cheaper in the most recent week. 5/1 ARMs dropped three basis points to 2.93%. 1-year ARMs slipped a single b.p., falling to 2.40%. A year ago, 5/1 ARMs were at 2.74%, and 1-year ARMs at 2.58%.
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Freddie Mac vice president and chief economist Frank Nothaft noted in a statement that the modest but inconsistent movements in rates — some up, some down — came during a week of little real rate-moving economic news: “Of the few releases, real GDP was revised down to -1.0% growth in the first quarter of 2014. ADP Research Institute estimated the private sector added 179,000 jobs in May, which followed a slight downward revision of 5,000 jobs in April. Meanwhile, the Institute for Supply Management reported the manufacturing industry saw a slight acceleration in monthly growth for May.”
On balance, the limited news is probably a slight negative for the economy. If things get worse, expect rates to resume their downward slide.
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Sarah Burns is an editor and writer at 24/7 Wall St. She previously worked at AOL and MSN. She began her career in book publishing at Viking Press/Penguin Books and has been writing and editing general and financial news stories for the last 15 years.
In addition to 24/7 Wall St. and 24/7 Tempo, her stories have appeared in USA Today, MSN, MarketWatch, Business Insider, and Yahoo Finance.
Sarah has edited numerous travel and garden books. She teaches urban farming in New York City public schools and is an instructor at the New York Botanical Garden. She graduated from Bowdoin College in Maine with a bachelor’s degree in English. She is based in New York City.
