The average Freddie Mac rate for a 30-year fixed rate mortgage climbed three basis points to 3.62% during the week ending Aug. 16 as the long-term rate indicative 10-year Treasury bond yield hit a high not seen since May.
At deadline Thursday morning, the 10-year yield was at 1.8%.
"The latest economic indicators point toward low inflation but gradually stronger economic activity which placed further upward pressure on long-term Treasury yields and, in turn, fixed mortgage rates,” Frank Nothaft, Freddie Mac’s chief economist said in his weekly rate report.
The average 15-year FRM rate jumped by four basis points to 2.88%, the average rate for a five-year Treasury-indexed hybrid dropped by one basis point to 2.76% and the average rate for a one-year Treasury-indexed adjustable-rate mortgage rose four basis points to 2.69%.
Average points were lowest for one-year Treasury ARMs at 0.4 of a point. All other loan types in Freddie Mac’s survey averaged 0.6 of a point.
A year ago, the average 30-year rate was 4.15%, the average 15-year rate was 3.36%, the average five-year Treasury hybrid rate was 3.08% and the average one-year Treasury ARM rate was 2.86%.
What have been near record-low rates have been driving a lot of refinancing and the rise in rates may spur more fence-sitters to act before rates rise any higher. But also some lenders are finding that the purchase markets in some markets that are counted on to sustain activity when rates rise have been showing some signs of revival in certain areas.
Paul Anastos, president at regional residential retail lender Mortgage Master, told this publication in a recent phone interview that in the relatively higher-priced metropolitan markets that his independent nonbank company lends in have been seeing some pickup this year going as far back as February due to the mild winter.
“There are a lot more competitive bids on homes,” he said.
