Mortgage rates inched up this past week and could extend the increase in next week’s report. One longer-term forecast has the escalation continuing through the end of the year.
Freddie Mac’s Primary Mortgage Market Survey indicated that 30-year fixed rates averaged 4.54 percent during the seven-day period that ended on July 26.
That was hardly any different than in last week’s report, when the average was 4.52 percent. But long-term mortgage rates have ascended 62 basis points from the same week a year ago.
Mortgage Daily’s analysis of Treasury market activity suggests that fixed mortgage rates could be around 3 BPS higher in next week’s survey from Freddie.
A majority of panelists surveyed by Bankrate.com for the week July 25 to July 31 agreed with Mortgage Daily’s forecast and predicted rates will move up at least 3 BPS. No change was expected by 36 percent, and just 9 percent projected a decline.
Freddie predicted in its
July 2018 Economic & Housing Market Forecast that 30-year fixed rates will average 4.6 percent this quarter and 4.8 percent in the fourth quarter.
In the U.S. Mortgage Market Index report from Mortgage Daily and OpenClose for the week ended July 20, jumbo rates were 11 BPS higher than conforming rates. A week earlier, the spread was 10 BPS.
Fifteen-year fixed rates
averaged 4.02 percent in Freddie’s survey, rising 2 BPS from the week ended July 19. Fifteen-year rates were 52 BPS less than 30-year rates, the same spread as last week.
Freddie’s survey had five-year, Treasury-indexed, hybrid, adjustable-rate mortgages averaging 3.87 percent, no different than one week prior.
Hybrid ARMs are expected by Freddie to average 3.9 percent in the third quarter and 4.1 percent during the final-three months of the year.
Hybrid ARM rates adjust based on the one-year Treasury note yield, which the Department of the Treasury reported closed at 2.41 percent Thursday, up from 2.40 percent seven days sooner.
Other ARM indices include the six-month London Interbank Offered Rate, which
Bankrate.com reported was unchanged Wednesday from a week earlier at 2.52 percent, and the Secured Overnight Financing Rate, which the Federal Reserve Bank of New York reported fell 3 BPS to 1.87 percent during the same period.
ARM share was 15.1 percent in the latest Mortgage Market Index report, wider than 13.7 percent the preceding week.
