Mortgage Interest Rate Report - April
Last Updated: 4/7/2014
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Long-term mortgage interest rates yo-yoed up and down in March as the economic winds shifted from week to week, according to mortgage finance company Freddie Mac.
During the first week of March, rates plummeted following a report of a decline in GDP and a mediocre jobs report. The average rate on a 30-year fixed rate mortgage (FRM) sank to 4.28 percent, excluding fees, from 4.37 percent the previous week. The 15-year FRM rate fell to 3.32 percent, down from 3.39 percent and the one-year adjustable rate mortgage (ARM) was unchanged at 2.52 percent.
"Mortgage rates were down this week as real GDP was revised downwards to 2.4 percent growth in the fourth quarter of 2013. Fixed residential investment negatively contributed to GDP decreasing 8.7 percent in the fourth quarter," said Freddie Mac vice president and chief economist Frank Nothaft in a statement. "The private sector added an estimated 139,000 jobs in February, which was below the market consensus and followed a downward revision of 48,000 jobs in January, according to the ADP Research Institute."
Rates bounced back up the following week, with the 30-year FRM carrying an average rate of 4.37 percent and the 15-year FRM rate rising to 3.38 percent. The one-year ARM rate dipped to 2.48 percent.
During the middle of the month, rates fell back down. The average rate on a 30-year FRM dropped to 4.32 percent, the 15-year FRM rate decreased to 3.32 percent while the one-year ARM inched up to 2.49 percent.
And in the last week, rates rebounded with the 30-year FRM rate rising to 4.40 percent, the 15-year FRM rate growing to 3.42 percent and the one-year ARM sinking to 2.44 percent.
“Mortgage rates rose following the uptick on the 10-year Treasury note after comments by the Federal Reserve Board Chair Janet Yellen indicated a possible increase in interest rates as soon as early 2015,” said Nothaft. “Also, the S&P/Case-Shiller 20-city composite house price index rose 13.2 percent over the 12-months ending in January 2014."
In March rates will likely continue to move upward but at a nice, slow pace. The Federal Reserve will continue to reduce its stimulus aid to the mortgage market and if the economy shows more positive signs than negative in the next four weeks, rates will feel some upward pressure.