Mortgage rates continued to increase this week, with the average rate for a 30-year, fixed-rate mortgage (FRM) rising to 4.16%, up from 4.13%, according to Freddie Mac’s Primary Mortgage Market Survey.
A year ago at this time, the 30-year FRM averaged 3.97%.
The average rate for a 15-year FRM was 3.37%, up from 3.36%. A year ago at this time, the 15-year FRM averaged 3.22%.
The average rate for a five-year, Treasury-indexed, hybrid adjustable-rate mortgage (ARM) was 3.19%, up from 3.17%. A year ago, the five-year ARM averaged 3.03%.
Mortgage rates have now increased for seven consecutive weeks, starting immediately after the presidential election on Nov. 8. Pushing rates even higher this week was the Fed’s Wednesday decision to raise the Fed Funds Rate by another 0.25% – the first rate hike since December 2015 and the second since 2006.
“As was almost universally expected: The Federal Open Market Committee [FOMC] closed the year with its one-and-only rate hike of 2016,” says Sean Becketti, chief economist for Freddie Mac, in a release. “The consensus of the committee points to more rate hikes in 2017. However, the experience of this year, combined with the policy uncertainty that accompanies a new administration, suggests a wait-and-see outlook.
“This week’s mortgage rate survey was completed prior to the FOMC announcement,” Becketti adds. “The 30-year mortgage rate rose three basis points on the week to 4.16 percent. The Mortgage Bankers Association’s Applications Survey posted drops in both refinance and purchase applications, registering the impact of recent mortgage rate increases. If rates continue their upward trend, expect mortgage activity to be significantly subdued in 2017.”