Mortgage rates stop risingby Tim Manni
Mortgage rates ended their six-week climb last week. Recently, mortgage rates reached five-month highs, but a holiday-shortened week and a less-than-stellar economic performance caused rates to fall back a few basis points:
HSH.com’s overall mortgage tracker — our weekly Fixed-Rate Mortgage Indicator (FRMI) — found that the overall average rate for 30-year fixed-rate mortgages eased back just a little, shedding three basis points (.03%) to end HSH.com’s national survey at 5.15%. Conforming 30-year FRMs also declined by a like amount. FHA-backed offers, so crucial to first-time homebuyers and low-equity refinancers, declined by a line basis point to end the holiday-shortened week at 4.78%, while the overall average rate for 5/1 Hybrid ARMs rose by a like amount to land at 3.89% for the week. HSH.com’s FRMI and other public data series includes rates for conforming, jumbo, and most recently the GSE’s “high-limit” conforming products and so cover much of the mortgage-borrowing public.
Warmer economic growth has been largely to blame for the increase in rates during the fall, but this increase has been exacerbated to a degree by the Federal Reserve’s stimulus program, some post-election improvement in moods and a tax compromise which lends some certainty (and a little boost) to the outlook as we roll into 2011.
Mortgage rates matter less this time of year. With two holiday-shortened weeks in a row, we don’t really expect any real movement in rates this week:
Mortgage rates and housing markets matter somewhat less than do holidays this time of year. Next week’s a holiday-shortened one as well, with a fairly light calendar of economic data due out. The leveling of interest rates for this week should largely turn into a two-week affair by the time next week rolls around, and we expect little change if any in mortgage rates.
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