Mortgage rates jumped to the highest since September as investors speculated that the Federal Reserve will slow bond purchases aimed at keeping borrowing costs down.
The average rate for a 30-year fixed mortgage was 17 basis points at 4.46% this week, according to a statement Thursday from Freddie Mac. The average 15-year rate also rose to 17 basis points from the previous week’s 15-year mortgage rate of 3.3%, the McLean, Va.-based government-sponsored enterprise said.
Mortgage rates have climbed from near-record lows in May as the Fed weighs how soon it should scale back its stimulus. Yields for 10-year Treasury notes, a benchmark for home loans, rose to the highest level in more than two months Wednesday after a private report showed U.S. payrolls increased more than economists estimated, adding to bets the central bank may advocate slowing bond purchases at this month’s policy meeting.
Purchases of new homes rebounded in October from the lowest level in more than a year, indicating buyers are starting to take higher rates in stride. New-home sales jumped 25% to a 444,000 annualized pace, following a 354,000 rate in the prior month that was the weakest since April 2012, the Commerce Department said Wednesday.