After dropping to their lowest levels in more than a year, mortgage rates rebounded this week but still remain below 4%. Some mortgage experts say that trend may not last and recommend locking in over the next week—before the October employment report is released. “The end of QE3 was baked into the rate cake, so there won’t be much effect on mortgage rates,” said Holden Lewis, assistant managing editor of Bankrate.com, which surveys experts in the mortgage industry to see if mortgage rates will rise, fall or remain relatively unchanged. “I recommend locking before the morning of Nov. 7, when the October employment report is released.”
The average for a 30-year fixed-rate mortgage rose to 3.98% from 3.92% last week, according to the latest survey from mortgage buyer Freddie Mac. A year ago at this time, the 30-year average was 4.10%. The average rate on a 15-year fixed loan also rose this week, inching up to 3.13% from 3.08% last week. It averaged 3.20% at this time a year ago.
Similarly, averages for the two most popular hybrid adjustable-rate mortgages edged up slightly. The five-year ARM rose to 2.94% this week, from 2.91% last week. A year ago, it averaged 2.96%. The one-year ARM average is trending at 2.43% this week, up from 2.41% last week. It was at 2.51% at this time last year. “Mortgage rates grew across the board this week, rebounding from the lowest rates of the year,” Frank E. Nothaft, Freddie Mac vice president and chief economist, said in a statement. “New home sales grew at an annual rate of 467,000 sales in September, the fastest rate observed during the recovery. Meanwhile, the National S&P Case-Shiller House Price Index grew at a seasonally adjusted annual rate of 0.4% in August.”
Rates fell this year after rising at the end of 2013, when the Federal Reserve announced it would begin to curb its bond-buying stimulus program. The program has helped offset dramatic gains in real estate prices and kept affordability elevated while the market has stabilized. In the latest Mortgage Rate Trend Index by Bankrate.com, 55% of the loan analysts polled believe mortgage rates will continue to hover around their current levels, while 36% predict rates will increase. “Fed says fed funds rate to remain low for considerable time period. Fed sees labor market improvement. It’s official. The Fed ends QE3,” said Shaun Guerrero, sales manager for Fairway Independent Mortgage in Silverdale, WA. “I see rates finally starting to climb toward the upper 4s by the end of the year … unless the rumors QE4 start to ramp up. Lock your rates if you can.”
FROM REALTOR.COM:
Mortgage Rates Ramp Up Slightly, Still Remain Below 4%
Oct 30, 2014, By: Rachel Stults
http://www.realtor.com/news/mortgage-rates-ramp-remain-4/
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