Fixed interest rates on residential loans moved lower this past week. While some signals suggest no change over the next week, the employment report could inject volatility.
Long-term fixed rates were lower, with 30-year fixed rates averaging 3.75 percent in Freddie Mac’s Primary Mortgage Market Survey for the week ended March 5.
The 30 year averaged 3.80 percent seven days earlier. Compared to the same week a year earlier, the average has tumbled 53 basis points.
In commenting on mortgage market movement, Freddie Mac Deputy Chief Economist Len Kiefer noted, “Real GDP growth for the fourth quarter was revised down to 2.2 percent. Consumer prices fell more than expected in January, tumbling 0.7 percent.”
Fixed rates aren’t likely to be much different in next week’s report from Freddie, according to Mortgage Daily’s analysis of Treasury market activity.
However, Friday’s jobs report could prompt wild swings in mortgage rates if more than 300,000, or fewer than 200,000, jobs were added last month.
A majority of panelists surveyed by Bankrate.com for the week March 5 to March 11 predicted rates will rise at least 3 BPS over the upcoming week. Less than a third expected no change, and just 15 percent forecasted a decline.
Rates on jumbo mortgages were priced 10 BPS higher than on conforming loans in the U.S. Mortgage Market Index report from LoanSifter/Optimal Blue and Mortgage Daily for the week ended Feb. 27. The jumbo-conforming spread thinned from 14 BPS in the previous report.
Freddie reported that 15-year fixed rates averaged 3.03 percent, down 4 BPS from the last survey. At 72 BPS, the spread between 15- and 30-year mortgages was
slightly thinner than 73 BPS in the previous survey.
Five-year, Treasury-indexed, hybrid, adjustable-rate mortgages averaged 2.96 percent, Freddie said, 3 BPS better than in the previous week.
At 2.44 percent, one-year Treasury-indexed ARMs averaged the same as in the week ended Feb. 26 but less than 2.52 percent in the week ended March 6, 2014.
The yield on the one-year Treasury closed Thursday at 0.25 percent, 3 BPS worse than seven days prior.
Like the one-year Treasury yield, the six-month London Interbank Offered Rate serves as an index for some ARMs. LIBOR was 0.38 percent Wednesday, Bankrate.com reported, the same as one week prior.
The latest Mortgage Market Index report had ARM share at 8.9 percent, widening from 8.6 percent the prior week.
