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| Fixed mortgage rates slipped while average adjustable rates tumbled. Meanwhile, most forecasts have mortgage rates heading higher.
The 30-year fixed-rate mortgage averaged 6.24%, slipping 2 basis points from last week and down 9 BPS from a year ago, according to Freddie Mac’s latest survey of mortgage-lending companies, thrifts and commercial banks. The 15-year average edged down 1 BPS to 5.90% this week, Freddie said. The 10-year Treasury note yield, which long-term mortgage rates tend to follow, was 4.26% near midday — off 9 BPS from last week. “Reports of weaker consumer spending in September and a decline in manufacturing activity in October kept mortgage rates at bay this week,” said Frank Nothaft, Freddie Mac vice president and chief economist. “Rates for long-term mortgages were little changed while rates for ARMs fell following the Federal Reserve’s interest-rate cut.” Half the panel of mortgage industry individuals surveyed by Bankrate.com this week continued to believe mortgage rates will rise over the next month and a half, compared to 29 percent who forecast a decrease and 21 percent who think they’ll remain relatively unchanged. For the quarter, the 30-year is expected to go higher than its current level to average between 6.4% and 6.5%, according to the latest mortgage market outlooks of Freddie, Fannie Mae, the National Association of Realtors and the Mortgage Bankers Association, which forecast the higher figure. Tumbling 9 BPS from a week ago, the 5-year Treasury-indexed hybrid adjustable-rate mortgage average came in at 5.89%, Freddie reported. At 5.50%, the 1-year Treasury-indexed ARM average reportedly fell 7 BPS from last week. The 1-year Treasury yield itself, at 3.83% on Tuesday, plunged 21 BPS from a week earlier, Federal Reserve data showed. The 6-month London Interbank Offered Rate averaged 4.85% for the week ending Wednesday, about 9 BPS better than a week earlier, Bankrate.com reported. The ARM share of total mortgage applications edged down from the prior week to 14%, according to the Mortgage Bankers Association’s latest application survey, which runs one week behind Freddie’s survey. A 2 percent decrease in overall mortgage application volume for the week ending Nov. 2 was triggered by a 3 percent downturn in refinance requests, as purchase money application activity was virtually unchanged from the prior week, MBA said. The refinance share, at 49%, inched down from the previous week, MBA reported. |
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