Mortgage Rates Continue Their March Higher
Freddie Mac released its weekly update on national mortgage rates this morning, showing a continued rise in interest rates across the board.
Thirty-year fixed-rate mortgages (FRM) rose nine basis points in comparison to the previous week, returning to the 3.51% level of late February. Shorter-term 15-year FRMs tacked on eight b.p. to average 2.69%, landing back around the levels of late January.
Among variable-rate mortgages, 5/1 adjustable-rate mortgages gained four basis points, rising to 2.62%. One-year ARMs added two b.p., rising to 2.55%.
Commenting on the numbers, Freddie Mac Vice President and Chief Economist Frank Nothaft noted that U.S. Treasury bond yields are also higher this week, attributing the rise in both types of rates to "signs of stronger consumer spending. Advanced retail sales rose 0.1 percent in April, above the market forecast consensus of a 0.3 percent decline. Excluding such items as automobiles and gasoline, sales were up 0.5 percent for the second time in three months."
Additionally, Nothaft pointed out that rates are moving higher because people are in a better position to pay: "Total household debt fell by about $110 billion in the first quarter." What's more, the number of homeowners who are 90 days or more late (or in foreclosure) on their first mortgages is down more than 40% from its peak in the fourth quarter of 2009.
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