Fixed mortgage rates continued to climb higher, seeing a huge weekly spike, and now sit higher than at this point a year earlier, Freddie Mac revealed in its weekly mortgage report.
According to Freddie Mac’s Primary Mortgage Market Survey for the week ending May 30, 2013, average mortgage rates for both 30-year and 15-year fixed loans are higher than at this time one year ago.
Both fixed-rate mortgages and adjustable-rate mortgages (ARMs) experienced average rate increases on a weekly basis, although the jump for fixed-rate mortgages was much more pronounced than the increase seen with ARMs.
Average rates for 30-year fixed mortgage rose sharply on a weekly basis, jumping from 3.59 percent to 3.81 percent. Shorter-term 15-year fixed-rate mortgages saw an even steeper weekly rise – from 2.77 percent to 2.98 percent.
One year ago at this time, 30-year fixed mortgages averaged 3.75 percent and 15-year fixed mortgages averaged 2.97 percent.
“Fixed mortgage rates followed long-term government bond yields higher following a growing market sentiment that the Federal Reserve may lessen its accommodative policy stance,” Frank Nothaft, vice president and chief economist at Freddie Mac, said in a statement. “Improving economic data may have encouraged those views.”
Nothaft mentioned improving consumer confidence and rising home prices as examples of “improving economic data” that is perhaps pushing interest rates higher.
Average interest rates for adjustable-rate mortgages (ARMs) showed mixed results in this weekly data, Freddie Mac said.
Rates for 5-year ARMs increased to 2.66 percent from 2.63 percent the previous week, while 1-year ARMs ticked down to 2.54 percent after averaging 2.55 percent the previous week.
ARM rates remain below what they were at this point one year earlier. At this time a year ago, 5-year ARMs averaged 2.84 percent and 1-year ARMs averaged 2.75 percent.