Sorry this post is a day late as I forgot to hit publish after writing this. I guess I was overwhelmed with joy and happiness by the snow…
Did I mention how much I hate snow?
Let’s look at the average mortgage rates reported by the MBA, Freddie Mac and Bankrate this week. I will also look at some of the stuff that happened this week and what we need to keep an eye on this upcoming week that could affect interest rates.
Freddie Mac Reported:
- 30-year fixed-rate mortgages averaged 3.81%
- This is down from last week when it averaged 3.92%
- Last year at this time, 30-year fixed-rate mortgages averaged 3.63%
- 15-year fixed-rate mortgages this week averaged 3.10%
- This is down from 3.19% last week
- Last year at this time, 15-year fixed-rate mortgages averaged 2.93%
This is the 3rd week that Freddie has reported falling mortgage rates!
Check out the mortgage rate chart from Freddie Mac:
30 year fixed rate mortgages decreased to 3.98%
15 year fixed rate mortgages were unchanged at 3.23%
30 year fixed rate jumbo mortgages decreased to 3.87%
The Mortgage Bankers Association Reported:
The average contract interest rate for 30 year fixed rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.06% from 4.12%, with points decreasing to 0.38 from 0.42 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
The average contract interest rate for 30 year fixed rate mortgages with jumbo loan balances (greater than $417,000) increased to 3.93% from 4.02%, with points decreasing to 0.30 from 0.35 (including the origination fee) for 80% LTV loans.
The average contract interest rate for 15 year fixed rate mortgages decreased to 3.29% from 3.42%, with points remaining increasing to 0.39 from 0.31 (including the origination fee) for 80% LTV loans.
This is the lowest interest rate reported by the MBA since October of last year.
The Take Away:
All of these decreasing rates sound great and should help some buyers.
While decreasing rates is good news, it is good news that has a root cause in bad news. And that bad news is the economic news in both the US and around the world.
Whenever the financial markets are having problems, investors start putting their money in government bonds. This means that mortgage rates fall.
So what has been some of the economic news this week?
- CPI fell 0.1% MoM
- Housing starts in December decreased from November
- Jobless claims increased
- Housing permits fell
- Retail sales fell 1% in December
There were some other negatives as well as some positives in my last post.
I hope that this negative stuff will not prevent anyone from buying a home IF it makes sense for them.
IF can be a really big word despite having only 2 letters.
Some of the stuff we need to watch this coming week that could impact interest rates and the economy:
- The Conference Board Consumer Confidence Index
- FHFA House Price Index
- S&P / Case Shiller Home Price Index
- New home sales numbers from HUD
- State unemployment numbers for December
- The Fed’s statement on Wednesday
- Pending home sales numbers from NAR
- Commerce Department’s December durable goods orders report
- Commerce Department’s initial reading on 4th quarter GDP
- The UofM Consumer Sentiment Index
- The Richmond and Kansas City Fed’s reports on manufacturing
Obviously lots of different data to gather and digest.
If only there was some place that would deliver the Ugly But Honest Truth to you…
The Fine Print:
As always, I am providing this to you for informational purposes only! I am a REALTOR and not a mortgage lender. You should contact the lender of your choice directly to learn more about its mortgage products and your eligibility for such products.