Here we are looking at mortgage rates for the first week of the year's second quarter and we might as well be looking at the rates for the beginning of the year. For fourteen week rates have moved up and down within a narrow range of 14 to 20 basis points, ending up, in the case of the 30-year fixed-rate mortgage (FRM) almost exactly where it began the year.

In a statement accompanying the release of Freddie Mac's Primary Mortgage Market Survey for the week ended April 5, Frank Nothaft, Freddie Mac vice president and chief economist remarked, "Mortgage rates have remained within a narrow band of 0.1 percentage points over every week in March. This relative stability is due to mixed economic data releases as to how strong the economy is and whether future inflation will recede. One bright spot this week came from an unexpected increase in pending home sales for February, which suggests the housing market is still healthy."



"Looking forward, the upcoming March employment report and producer price index should offer further insight into the current state of the economy and give us an idea where interest rates are headed in the future."

However, Freddie Mac's Economic and Housing Market Outlook for April, which will be discussed separately, doesn't forecast a lot of changes in rates, even as far out as 2009.

But back to the first week in April. The 30-year FRM averaged 6.17 with 0.4 point compared to 6.16 percent and 0.4 point the previous week. The 15-year FRM also moved up one basis point to 5.87 percent and fees and points increased from 0.4 to 0.5. This product started the year at 6.18 percent.

The five-year Treasury indexed hybrid adjustable rate mortgage (ARM) was a little more active, averaging 5.92 percent with 0.6 point. Last week it was 5.88 percent with 0.5 point. The one-year ARM, however, only moved up one basis point to 5.44 percent with fees and points unchanged at 0.6.

Rates were a little more active among respondents to the Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ended April 6. The average contract interest rate for 30-year FRMs was up three basis points to 6.16 percent with points, including the origination fee, up from 1.25 to 1.39. The 15-year FRM went from 5.85 percent during the week ended March 30 to 5.91 percent with points increasing to 1.15 from 1.09. The one-year ARM was up one basis point to 5.88 percent with points increasing to 0.75 from 0.72.

Mortgage application volume was down 0.4 percent on a seasonally adjusted basis from the previous week and up 0.1 percent on an unadjusted basis. In spite of the distractions of Passover and Easter, applications were up 10.8 percent compared to the same week one year ago.

Refinancing represented 42.8 percent of all mortgage activity, down from 44.5 the previous week and the adjustable rate mortgage share of applications continued to fall, with 18.7 of all applicants taking that option compared to 19.2 percent the previous week.