Mortgage rates are still incredibly low by historical standards. They've been fluctuating around record lows not seen in more than a half-century for a good many months now. This week was one where that movement was upward, according to industry data released Thursday.
[IMAGE]A nationwide ""survey conducted by Freddie Mac"":http://www.freddiemac.com/pmms/release.html?week=43&year=2010&display=release found that 30-year fixed-rate mortgages averaged 4.23 percent (0.8 point) for the week ending October 28. That's up from last week's average of 4.21 percent, and the second consecutive time in the past six weeks 30-year rates have risen.
Rates for 15-year fixed mortgages averaged 3.66 percent (0.7 point) this week in Freddie's study. Last week, the 15-year rate came in at 3.64 percent.
The GSE reported that rates for adjustable-rate mortgage (ARMs), on the other hand, are heading lower. The 5-year ARM averaged 3.41 percent this week (0.6 point), down from last week when it was 3.45 percent. The 5-year ARM has not been lower since Freddie Mac started tracking it in January 2005.
Frank Nothaft, VP and chief economist at Freddie Mac, says the historically low rates are supporting home sales and reducing the excess stock of homes available for sale.
[COLUMN_BREAK]He notes that existing home sales, including condominiums and co-ops, rose for the second consecutive month in September, up almost 18.0 percent over July's low.
Similarly, sales of new homes had back-to-back increases and were 7.7 percent above July. Nothaft pointed out that the inventory of new homes for sale has either stayed the same or declined every month of this year.
A ""separate study released by Bankrate"":http://www.bankrate.com/finance/mortgages/mortgage-rates-zoom-higher.aspx Thursday, which is based on data provided by the top 10 banks and thrifts in the top 10 U.S. markets, also showed that mortgage rates jumped after five weeks of record-low readings and returned to levels last seen one month ago.
The tracking company reported that the average rate on the benchmark conforming 30-year fixed mortgage moved up to 4.51 percent (0.33 point) this week from 4.22 percent last week.
The average 15-year fixed mortgage rate climbed to 3.90 percent (0.33 point) in Bankrate’s survey, up from 3.82 percent the week prior, while the larger jumbo 30-year fixed rate reversed last week's decline, returning to 5.10 percent.
Bankrate says adjustable-rate mortgages were higher also, with the average 5-year ARM rising to 3.67 percent and the average 7-year ARM rebounding to 3.95 percent.
Bankrate noted in its report that even though the Federal Reserve is poised to announce renewed efforts to boost the economy, it doesn't automatically mean lower mortgage rates.
“Investors tempering their expectations were behind the increase seen this week and if inflation worries increase once specifics of the Fed's bond-buying are announced, mortgage rates could continue moving higher. Time will tell just what impact the Fed has on mortgage rates and the overall economy,†Bankrate said.