Mortgage activity jumped, the one-year adjustable-rate mortgage is at its lowest point in more than six years and the 15-year fixed-rate mortgage is at its lowest level on record.
Inching up 0.01% from seven days prior, the average 30-year fixed-rate mortgage was 4.79% in Freddie Mac’s Primary Mortgage Market Survey for the week ended June 3. The 30-year was 5.29 during the same week last year.
The average 30-year conventional rate in the Mortech-MortgageDaily.com Mortgage Market Index for the week ended June 2 climbed to 4.836% from 4.747% seven days earlier. At the same time, the average jumbo 30-year rate increased 5 basis points to 5.650%. The resulting spread between the conventional and jumbo mortgage narrowed to 81 BPS from last week’s 85 BPS.
The yield on the 10-year Treasury note closed today at 3.39%, according to the U.S. Department of the Treasury. The 10-year yield closed at 3.34% last Thursday, indicating rates could be slightly higher in next week’s reports.
No change in mortgage rates was forecasted by 62 percent of Bankrate.com panelists for the week June 3 to June 9. Rates will rise at least 3 BPS over the next week according to another 38%, and none of the panelists predicted a decline.
Moving on to the 15-year fixed-rate mortgage, it averaged 4.20% in Freddie’s survey, the lowest level “since Freddie Mac started tracking the 15-year fixed-rate mortgage in August of 1991.” The 15-year was 4.21 last week. The 15-year averaged 4.220% in the Mortgage Market Index report, higher than last week’s 4.14%.
“The economy grew at a slower rate than originally reported in the first three months of the year, according to the Bureau of Economic Analysis, which suggests inflation will remain tame in the near term,” Freddie Chief Economist Frank Nothaft explained in the report. “There are also signs that credit conditions may be improving.”
The five-year Treasury-indexed hybrid adjustable-rate mortgage fell 3 BPS from last week to 3.94%, Freddie said.
But there was no weekly change in the one-year Treasury-indexed ARM, which Freddie reported at 3.95% — its lowest level since May 2004. The one-year was 4.81% a year earlier. Its index, the yield on the one-year Treasury bill, closed today at 0.38%, barely changed from 0.37% a week prior, the Treasury reported.
The six-month London Interbank Offered Rate, meanwhile, was unchanged from a week earlier at 0.76%.
ARM share fell to 5.2 percent in the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ended May 28 from the previous week’s 6.0 percent.
The Mortgage Market Index shot up to 324 from last week’s 270. The average U.S. loan amount fell to $212,806 from $220,893. The highest average loan amount was in Washington, D.C.: $326,702. West Virginia’s $135,038 was the lowest.
A week earlier, based on MBA’s survey, applications edged up 1 percent on a seasonally adjusted basis from the prior week. Refinances rose 2% but purchases fell 4%.
The refinance share fell to 48% in the Mortech-MortgageDaily.com report from 52% a week ago. The latest share reflected a rate-term share of 35% and a cashout refinance share of 13%.
MBA’s older data reflected that the refinance share rose to 74% from 72%.
