After dropping for three consecutive weeks – each time to a new historic low – mortgage rates reversed course this week and increased slightly, with the average rate for a 30-year, fixed-rate mortgage rising to 3.01%, up from 2.98% the previous week but down from 3.75% a year ago, according to Freddie Mac’s Primary Mortgage Market Survey.
“While housing demand continues to rebound, the month-long swoon in economic activity has caused the 10-year Treasury benchmark to drop,” explains Sam Khater, chief economist for Freddie Mac, in a statement. “In the short-term, this means the demand will continue on the back of near record low mortgage rates.
“However, the most recent consumer spending data has been pointing to slow growth since mid-June,” Khater adds. “The concern is that the pause in economic activity will cause unemployment to remain elevated which will lead to longer-term labor market distress.”
For the week ended July 23, the average rate for a 15-year fixed-rate mortgage was 2.54%, up from 2.48% the previous week but down from 3.18% a year ago.
The average rate for a five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) was 3.09%, up from 3.06% the previous week but down from 3.47% a year ago.