Mortgage rates were up slightly during the pre-holiday week
ended December 20 according to the Primary Mortgage Market Survey conducted
by Freddie Mac.
The 30-year fixed rate mortgage (FRM) averaged 6.14 percent with 0.4 point
for the week, up from 6.11 percent with 0.5 point the week before. During the
same week in 2006 the 30-year FRM carried an average interest rate of 6.13 percent.
The 15-year FRM increased one basis point from the previous week to an average
of 5.79 percent. Fees and points decreased from 0.5 to 0.4. One year ago this
product averaged 5.89 percent.
The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) also increased
one basis point to 5.90 percent while fees and points were down from 0.6 to
0.5 on average. Last year the five-year ARM averaged 5.96 percent.
One-year Treasury-indexed ARMs averaged 5.51 percent compared to 5.50 percent
a week earlier. Fees and points were unchanged at 0.6. Last year the one-year
ARM stood at 5.44 percent.
Frank Nothaft, Freddie Mac vice president and chief economist
indicated that the rates had whipsawed during the week. He said "Stronger-than-expected
inflation reports and retail sales for November put upward pressure on long-term
interest rates late last week. However, ensuing data releases suggested further
weakness in the housing market over November and December and allowed interest
rates to drift back down. The net effect left mortgage rates little changed
"Both the producer and consumer price indexes jumped for the month of
November, implying inflation may still be a threat to the economy while retail
sales increased twice as much as market forecasts, reflecting healthy consumer
spending. At roughly the same time, single-family housing starts fell 5.4 percent
in November to 829,000, the slowest pace since April 1991, and homebuilder confidence
in December held for the third consecutive month at the lowest level since records
began in January 1985."
The Weekly Mortgage Applications Survey from the Mortgage
Bankers Association (MBA) indicated a much wider swing in rates over the same
time period. During the week ended December 21 the 30-year FRM decreased to
6.10 percent with 1.05 points, including the origination fee from 6.18 percent
with 1.12 points the previous week.
The average rate of 15-year FRMs dropped 12 basis points to 5.66 percent with
points decreasing to 1.09 from 1.10.