Mortgage rates rose slightly for the second consecutive week, but should remain low for the foreseeable future, which will aid the purchase market, according to Freddie Mac.
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The 30-year fixed-rate mortgage averaged 4.12% for the week ending April 11, up from last week when it averaged 4.08%. A year ago at this time, the 30-year fixed-rate mortgage averaged 4.42%.
“Rates moved up slightly this week while mortgage applications decreased following last week’s jump in rates — indicating borrower sensitivity to changing mortgage rates,” Sam Khater, Freddie Mac’s chief economist, said in a press release. “Despite the recent rise, we expect mortgage rates to remain low, in line with the low 10-year treasury yields, boosting homebuyer demand in the next few months.”
The 15-year fixed-rate mortgage this week averaged 3.6%, up from last week when it averaged 3.56%. A year ago at this time, the 15-year fixed-rate mortgage averaged 3.87%.
The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.8% with an average 0.4 point, up from last week when it averaged 3.66%. A year ago at this time, the five-year adjustable-rate mortgage averaged 3.61%.
Investors interpreted the slowing of wage growth in the April 5 jobs report “as additional evidence that price growth will stay below the Fed’s objective rate of two percent, preventing rates from substantial increases,” Matthew Speakman, an economic analyst at Zillow, said when that company released its rate tracker.
The April 10 release of the minutes from the Federal Open Market Committee’s March meeting confirmed that it is unlikely to increase short-term interest rates during 2019. “Low-price growth was an important contributor to the Fed’s dovish policy adjustment last month, and many investors believe that without the threat of a meaningful uptick in inflation it is highly unlikely that bond yields, and mortgage rates, will increase a significant amount,” Speakman said.