Fixed Mortgage Rates Spike
Freddie Mac released its weekly update on national mortgage rates this morning, showing a continuing upward trend.
Thirty-year fixed rate mortgages (FRM) spiked sharply this week, rising 11 basis points in comparison to last week to hit 3.53% -- a new high for this still-young year and the first week the 30-year fixed-rate mortgage has averaged above 3.5% since Sept. 13, 2012. Fifteen-year FRMs are up a similar 10 basis points, to 2.81%.
Adjustable-rate mortgages are also on the rise. After three weeks of stasis, 5/1 ARMs rose three basis points to reach 2.7%, while one-year ARMs tacked on two basis points and now stand at 2.59%.
Commenting on the numbers, Freddie Mac Vice President and Chief Economist Frank Nothaft said: "Mortgage rates continued to trend upwards this week amid a growing economy led in part by the recovering housing market. For instance, new home sales totaled 367,000 in 2012, the most in three years and reflected the first annual increase in seven years. Pending home sales in 2012 averaged its highest reading since 2006. And the S&P/Case-Shiller 20-city composite house price index rose 5.5 percent over the 12-months ending in November 2012, the largest annual growth since August 2006. All of these factors helped residential fixed investment to add nearly 0.4 percentage points to real GDP growth in the fourth quarter alone."
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