Conforming 30-year hits 2014 lowby Tim Manni
If there’s one theme for this week’s review of mortgage rates it’s “act now.”
By the end of last week, mortgage rates continued on much of the same pattern they did the week prior, dropping a few basis points all around. But Keith Gumbinger, vice president of HSH.com and author of the weekly Market Trends newsletter, says the mortgage-rate dip won’t last.
“Mortgage rates stepped back a little this week, but all indications are that an uptick is imminent, as the underlying interest rates which help to govern fixed-rate mortgages have firmed up measurably in recent days,” Gumbinger wrote on Friday evening.
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Mortgage rates: 2014 lows
While we can’t boast that the economy is doing better, we can say that for the moment it has stopped getting worse. Here’s how mortgage rates finished the week ending March 7:
- 30-year: The overall average rate for 30-year fixed-rate mortgages (conforming, non-conforming and jumbo) slipped by 0.03 percent to land at 4.39 percent, 2014’s lowest average rate to date
- 15-year: The overall average rate for 15-year fixed-rate mortgages (conforming, non-conforming and jumbo) also eased by 0.03 percent to dip to 3.51 percent
- FHA: FHA-backed 30-year fixed-rate mortgages joined the party, sliding 0.03 percent for the week
- 5/1 ARM: Finally, the overall 5/1 Hybrid ARM also managed a fall of 0.03 percent, dipping to an average rate of 3.03 percent, remaining at its lowest point since late November
Jobs and mortgage rates
The monthly employment report is always an important indicator for rate-watchers. While far from stellar, the February figures are a perfect example of how things, while not much better, aren’t getting much worse. “Overall, the news about the job market was better than expected and may also contribute to a firmer rate environment,” wrote Gumbinger.
February added 175,000 new jobs on top of positive revisions for both January and December numbers, while the unemployment rate ticked upward to 6.7 percent.
How do these numbers influence the Federal Reserve and their pending decision to continuing tapering? Gumbinger says we shouldn’t hold fast to the 6.5 percent unemployment rate figure, but rather pay close attention to the labor market as a whole.
What will happen this week?
If you’re on the refinance fence waiting for mortgage rates to drop just a bit further, get off it and into the game. We expect rates to rise this week, taking back last week’s decline and then some. Gumbinger expects an increase of 0.08 to 0.10 percent by the time the week is through.