Despite uncertainty over whether the Fed will continue to hike the cost of money in the wake of Hurricane Katrina, long-term mortgage rates edged up this week, according to surveys conducted by Freddie Mac and Bankrate.com.
In Freddie Mac’s survey, the 30-year fixed-rate mortgage averaged 5.74 percent for the week ended today, up from last week when it averaged 5.71 percent. The average for the 15-year fixed-rate mortgage is 5.32 percent, up from last week when it averaged 5.3 percent. Points on both the 30- and 15-year averaged 0.6.
The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 5.26 percent this week, with an average 0.6 point, up from last week when it averaged 5.24 percent. The one-year Treasury-indexed ARM averaged 4.46 percent, also with an average 0.6 point, up slightly from last week when it averaged 4.45 percent.
“Mortgage rates were relatively unchanged this week as the markets wait for the results of the upcoming Federal Reserve policy committee meeting,” said Frank Nothaft, vice president and chief economist at Freddie Mac. “Core Consumer Price Index (CPI) released this week came in lower than had been expected, which led the market to believe that the Fed has further room to take a pause in raising rates and this has kept financial markets fairly quiet this week.”
In Bankrate.com’s survey, mortgage rates were little changed, as the economic impact of Hurricane Katrina remains unknown. The average 30-year fixed-rate mortgage in its survey increased from 5.8 percent to 5.84 percent this week. The 30-year fixed-rate mortgages in this week’s survey had an average of 0.37 discount and origination points.
Bankrate.com reported that the average 15-year fixed mortgage rate increased by a similar amount this week, rising from 5.39 percent to 5.44 percent, while the average jumbo 30-year fixed-rate climbed above the 6 percent barrier to 6.02 percent from 5.97 percent last week. Adjustable-rate mortgages were mixed, with the average 5/1 adjustable-rate mortgage rising from 5.36 percent to 5.4 percent, while the average one-year ARM fell from 4.91 percent to 4.87 percent – the lowest point since Aug. 3.
Mortgage rates are largely unchanged since Hurricane Katrina ravaged the Gulf Coast, Bankrate.com reported. With the economic impact and the path of the Federal Open Market committee – which meets again Sept. 20 – still being debated, yields on 10-year Treasury notes remain near 4.15 percent. Fixed mortgage rates are closely related to yields on long-term government bonds. Some clarity as to the Fed’s intentions may emerge following the Sept. 20 meeting, but the economic impact of the storm is far from being determined.
The following is a sampling of Bankrate’s average 30-year-mortgage interest rates this week in some U.S. metropolitan areas:
New York – 5.83 percent with 0.19 point
Los Angeles – 5.88 percent with 0.59 point
Chicago – 5.94 percent with 0.03 point
San Francisco – 5.88 percent with 0.33 point
Philadelphia – 5.73 percent with 0.36 point
Detroit – 5.84 percent with 0.25 point
Boston – 5.88 percent with 0.1 point
Houston – 5.84 percent with 0.72 point
Dallas – 5.89 percent with 0.54 point
Washington, D.C. – 5.73 percent with 0.56 point
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