Mortgage rates moved higher this week as unemployment figures finally improved, according to mortgage financier Freddie Mac.
The company, which reported its first profit in two years last week, said the 30-year fixed averaged 5.29 percent during the week ending August 13, up from 5.22 percent last week, but below the 6.52 percent average seen a year ago.
The 15-year fixed averaged 4.68 percent, up from 4.63 percent a week earlier, but well below the 6.07 percent seen in 2008.
“Long-term fixed-rate mortgage rates rose slightly over the past week while initial rates on adjustable-rate mortgages (ARMs) were little changed,” said Frank Nothaft, Freddie Mac vice president and chief economist.
“Last week’s release of July’s employment report showed a slight improvement in the declining labor market. The unemployment rate ticked down to 9.4 percent in July, representing the first monthly decline since April 2008. Approximately 247,000 jobs were lost, fewer than the market consensus and the smallest loss since August 2008. In addition, revisions added 43,000 employees to payrolls in May and June.”
The five-year ARM increased two basis points to 4.75 percent, but remains far below the 6.02 percent average from last year.
The one-year ARM was the only winner this week, slipping to 4.72 percent from 4.78 percent, though it remains close to the 5.18 percent average seen a year ago.
These rates are good for conforming loans with 20 percent equity or down payment; jumbo loans are pricing about a percentage point higher.
As usual, Nothaft was optimistic about the housing market, remarking that, “Declines in some local housing markets may be nearing an end as well.”
Unfortunately, good economic news will continue to put upward pressure on mortgage rates, so it’s a bit of a catch-22 (how mortgage rates work).
Related Topics:
