Mortgage Rates Stall At Yearly Lows As Summer Winds Down

Mortgage Rates Stall At Yearly Lows As Summer Winds Down

I saw this article written by Kathy Orton for the Washington Post and thought it was an interesting read.

It was another quiet week in the mortgage market with rates leveling off at yearly lows.

Although the housing market put out mixed reports earlier this week —newly built home sales surged while existing home sales fell sharply last month —the news had no effect on home-loan rates., which puts out a weekly mortgage-rates trend index, found that three-quarters of the experts it surveyed think rates will remain unchanged in the next week, moving no more than plus or minus two basis points (a basis point is 0.01 percentage point) in the next week. The other quarter think they will go up.

According to the latest data released Thursday by the Federal Home Loan Mortgage Corp., or Freddie Mac, the 30-year fixed-rate average was the same as it was a week ago, unchanged at 3.43 percent with an average 0.6 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.84 percent a year ago.

The 30-year fixed rate has stayed below 3.5 percent for more than two months. It has been stuck between a high of 3.48 percent and a low of 3.41 percent since late June.

The 15-year fixed-rate average also didn’t move this week, remaining at 2.74 percent with an average 0.5 point. It was 3.06 percent a year ago.The five-year adjustable rate average ticked up to 2.75 percent with an average 0.4 point. It was 2.74 percent a week ago and 2.90 percent a year ago.

“Treasury yields were little changed from the prior week and the 30-year fixed-rate mortgage held steady at 3.43 percent this week,” Sean Becketti, Freddie Mac chief economist, said in a statement. “This marks the ninth consecutive week that mortgage rates have been below 3.5 percent. Markets are erring on the side of caution ahead of the second estimate for second-quarter GDP and Fed Chair Janet Yellen’s speech on Friday.”

This time of year is typically the slow season for home buying, with buyers more focused on one last trip to the beach or back to school. Even the refinance market is listless despite the low rates.

It was no surprise then that mortgage applications were lower again this week, according to the latest data from the Mortgage Bankers Association.

The market composite index —a measure of total loan application volume —fell 2.1 percent from the previous week. The refinance index decreased 3 percent, while the purchase index dropped 0.3 percent.

The refinance share of mortgage activity accounted for 62.4 percent of all applications.

“The level of mortgage market activity did not change much last week with purchase applications remaining flat and refinances declining in response to a small decrease in mortgage rates,” said Lynn Fisher, MBA vice president of research and economics.

Kathleen Argiroff Headshot
Phone: 252-202-8147
Dated: September 1st 2016
Views: 298
About Kathleen: Kathleen relocated to the Outer Banks of North Carolina with her husband and three children in 1989 ...

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