For the eighth consecutive week, borrowing costs were on the rise.
“Optimistic testimony on Capitol Hill from Federal Reserve Chairman Jerome Powell sent Treasury yields higher as Powell stated his outlook for the economy has strengthened since December,” says Len Kiefer, Freddie Mac’s deputy chief economist. “Following Treasurys, the 30-year fixed mortgage rate jumped 3 basis points to reach 4.43 percent in this week’s survey. The 30-year rate has been on a tear in 2018, climbing 48 basis points since the start of the year.”
Kiefer continues that historically when mortgage rates rise, the housing market teeters, but he doesn’t foresee that happening this time around.
“We think strength in the economy and pent-up housing demand should allow U.S. housing markets to post modest growth this year even with higher mortgage rates,” Kiefer says. “We really have to wait for housing markets to heat up in the spring, but early indications are that housing demand remains robust to these rate increases.”
Freddie Mac reports the following national averages with mortgage rates for the week ending March 1:
- 30-year fixed-rate mortgages: averaged 4.43 percent, with an average 0.5 point, rising from last week’s 4.40 percent average. Last year at this time, 30-year rates averaged 4.10 percent.
- 15-year fixed-rate mortgages: averaged 3.90 percent, with an average 0.5 point, rising from last week’s 3.85 percent average. A year ago, 15-year rates averaged 3.32 percent.
- 5-year hybrid adjustable-rate mortgages: averaged 3.62 percent, with an average 0.4 point, dropping slightly from last week’s 3.65 percent average. A year ago, 5-year ARMs averaged 3.14 percent.
Source: Freddie Mac
