Two-Month Forecast suggests little change in ratesby Tim Manni
“Mortgage rates are mostly wandering around directionless,” said Keith Gumbinger, vice president of HSH.com, in our latest Mortgage Rates Radar. “They continue backing and filling, waiting for clear signals that the economy is picking up steam or losing it. With the tax bite from the fiscal cliff solution just starting to show in paychecks, it’s a fair bet that some slowdown in spending is likely. How much is anyone’s guess at this point.”
Mortgage rates tick back up
Rates on the most popular types of mortgages rose slightly, according to HSH.com’s Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages increased by two basis points (0.02 percent) to 3.55 percent. Conforming 5/1 Hybrid ARM rates rose by four basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 2.69 percent.
If the economy slows along with consumer spending, that could lead to lower mortgage rates just ahead.
“Mortgage rates are holding a little above bottom, but that’s probably based more on the three percent growth in the third quarter of 2012 than any assessment of the current climate, let alone a forward looking one,” said Gumbinger. “There remain plenty of economic challenges just ahead.”
Two-Month Forecast for mortgage rates
To help mortgage shoppers look forward, HSH.com released its latest Two-Month Forecast for mortgage rates.
In many ways, the current Two-Month Forecast isn’t all that different from our last forecast period. We’re in a period of modest economic growth, contentious politics and extraordinary support from the Federal Reserve.
That suggests to us little reason to expect much different conditions for mortgage rates than those we’ve just seen. Overall, absent fiscal catastrophe, we don’t have a lot of space for rates to fall, but little reason to expect them to jump much, either.
This forecast will expire as the calendar turns to spring which sounds nice in the dead of winter. Be sure to read our latest Two-Month Forecast for mortgage rates to see exactly where we believe rates will wander over the next two months.