Freddie Mac: Mortgage Rates Continue To Climb

Posted by Patrick Barnard on December 22, 2016 No Comments
Categories : Residential Mortgage

Fixed mortgage rates continued their upward march this week, with the average rate for a 30-year reaching 4.30%, up from 4.16% the previous week, according to Freddie Mac’s Primary Mortgage Market Survey.

A year ago at this time, the 30-year, fixed-rate mortgage (FRM) averaged 3.96%.

Freddie Mac notes that this is the highest mortgage rates have been in nearly two years.

The average rate for a 15-year FRM, for the week ended Dec. 22, was 3.52%, up from 3.37%. A year ago at this time, the 15-year FRM averaged 3.22%.

The average rate for a five-year, Treasury-indexed, hybrid adjustable-rate mortgage (ARM) was 3.32%, up from 3.19%. A year ago, the five-year ARM averaged 3.06%.

Sean Becketti, chief economist for Freddie Mac, attributed the increase mainly to the Fed’s 0.25% rate hike that took effect on Dec. 15. However, it should be noted that rates were already on the rise due to a mix of macroeconomic factors.

“A week after the only rate hike of 2016, the mortgage industry digested the Fed’s decision, and this week’s survey reflects that response,” Becketti says in a release. “Following Yellen’s speech last Wednesday, the 10-year Treasury yield rose approximately 10 basis points. The 30-year mortgage rate rose 14 basis points to 4.30 percent, reaching highs we have not seen since April 2014.”

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