Rising Bond Yields Spark Rise in Mortgage Rates
Freddie Mac released its weekly update on national mortgage rates on Thursday morning, showing continued rises in rates nearly across the board.
Thirty-year fixed-rate mortgages, or FRMs, rose six basis points to 4.20% over the past seven days, while 15-year FRMs jumped eight basis points. to 3.31%. One year ago, 30-year FRMs averaged 3.98% and 15-year mortgages averaged 3.10%.
Five-year adjustable-rate mortgages, or ARMs, shot up even faster in the most recent week, rising 12 basis points to 3.05%. One-year ARMs stood pat at 2.4%. A year ago, 5-year ARMs were at 2.79% and 1-year ARMs at 2.58%.
Freddie Mac Vice President and Chief Economist Frank Nothaft noted in a press release that an increase in 10-year Treasury yields appears to be behind the rise in rates. He also noted that the economy added 217,000 jobs in May, following a 282,000 surge in April and a 203,000 increase in March.
These jobs create paychecks that workers can use to pay higher mortgage rates, helping the rates to rise.
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