Mortgage rates are moving higher thanks to some strong economic data over the past few days. If you’re considering buying a home or refinancing your current mortgage, we strongly recommend that you take action sooner rather than later to avoid the risk of locking in a higher rate. Read on for more details.
Where are mortgage rates going?
Rates spike in Freddie Mac PMMS
A sell-off in the bond market this week has put some upward pressure on mortgage rates.
This is evident in today’s Freddie Mac Primary Mortgage Market Survey, which has the average rate on a 30-year fixed up to a seven-year high. Here are the numbers:
- The average rate on a 30-year fixed rate mortgage moved up six basis points to 4.61% (0.4 points)
- The average rate on a 15-year fixed rate mortgage rose seven basis points to 4.08% (0.4 points)
- The average rate on a 5/1-year adjustable rate mortgage ticked up five basis points to 3.82% (0.3 points)
Here is what Freddie Mac’s Economic and Housing Research Group had to say about rates this week:
“After plateauing in recent weeks, mortgage rates reversed course and reached a new high last seen eight years ago.
The 30-year fixed mortgage rate edged up to 4.61 percent, which matches the highest level since May 19, 2011.
Healthy consumer spending and higher commodity prices spooked the bond markets and led to higher mortgage rates over the past week. Not only are buyers facing higher borrowing costs, gas prices are currently at four-year highs just as we enter the important peak home sales season.
While this year’s higher mortgage rates have not caused much of a ripple in the strong demand levels for buying a home seen in most markets, inflationary pressures and the prospect of rates approaching 5 percent could begin to hit the psyche of some prospective buyers.”
It’s always important to note that the data for the survey is mostly collected early on in the week and therefore doesn’t necessarily reflect current market conditions.
That being said, we’ve seen rates stay fairly level since mid-day on Tuesday, so the PMMS isn’t far off what what national averages currently are.
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Rate/Float Recommendation
Lock before rates move even higher
With mortgage rates heading higher it makes sense that you’ll want to lock in a rate soon. The longer you wait, the more likely it is that you’ll wind up locking in a higher rate.
Of course, everyone’s situation has its own unique factors, which is why it’s so incredibly important to go discuss your options with an experienced mortgage professional.
Learn what you can do to get the best interest rate possible.
Today’s economic data:
Jobless Claims
Applications filed for U.S. unemployment benefits for the week of 5/12/18 rose 11,000 from the previous week to 222,000. That puts the four-week moving average at 213,250.
Philadelphia Fed Business Outlook Survey
The Philly Fed General Business Conditions Index surged up to a 34.4 in May. With new orders up to a 45-year high, this is one of the most robust reports to date.
Bloomberg Consumer Comfort Index
- This report is currently being delayed at the source
Fedspeak
- Minneapolis Fed President Neel Kashkari at 10:45am
- Dallas Fed President Robert Kaplan at 1:30pm
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Notable events this week:
Monday:
- Fedspeak
Tuesday:
- Retail Sales
- Empire State Mfg Survey
- Business Inventories
- Housing Market Index
Wednesday:
- Housing Starts
- Fedspeak
- Industrial Production
- Atlanta Fed Business Inflation Expectations
- EIA Petroleum Status Report
Thursday:
- Jobless Claims
- Philadelphia Fed Business Outlook Survey
- Bloomberg Consumer Comfort Index
- Fedspeak
Friday:
- Fedspeak
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from Total Mortgage Blog https://ift.tt/2IN4iJG
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