UPDATE: Mortgage rates tick up, but applications still hit a 9-year high
By Andrea Riquier
So far this year, the 30-year-fixed has averaged 4.33%, down from 4.54% in 2018
Rates for home loans rose as economic indicators strengthened, mortgage guarantor Freddie Mac reported Thursday (http://www.freddiemac.com/pmms/pmms_archives.html).
The 30-year, fixed-rate mortgage averaged 4.17% in the April 18 week, up from 4.12%. That was the third straight weekly increase for the popular product, a feat it hadn't achieved since September. The 15-year fixed-rate mortgage averaged 3.62%, up two basis points. The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.78%, down from 3.80%.
Those rates don't include fees associated with obtaining mortgage loans.
See also:Mortgages? Big banks may be throwing in the towel (http://www.marketwatch.com/story/mortgages-big-banks-may-be-throwing-in-the-towel-2019-04-16)
Fixed-rate mortgage rates follow the yield of the 10-year U.S. Treasury note which has risen as investors grow more confident about the health of the economy. Strong data, like the lowest jobless claims in five decades (http://www.marketwatch.com/story/jobless-claims-dive-even-lower-to-192000-sit-at-nearly-50-year-low-2019-04-18), has made riskier assets, like stocks, (http://www.marketwatch.com/story/wall-streets-fear-index-tumbles-to-6-month-low-as-stock-market-nears-records-2019-04-12) more attractive. When bond prices decline, yields, or rates, rise.
As mortgage rates churn higher, affording a new home purchase will become more challenging for some Americans. But financing costs remain extremely low compared to historical norms. And the five-basis-point increase over the past week would add about $6 a month to the cost of principal and interest on a median-priced home, according to Zillow's Mortgage Calculator (https://www.zillow.com/mortgage-calculator/).
Consumers seem to know that. Applications for purchase mortgages hit a nine-year high in the most recent week, even as rates ticked slightly higher, the Mortgage Bankers Association said Wednesday. Demand is strong, and many Americans who've been shut out of a hyper-competitive housing market for years may finally get their chance (http://www.marketwatch.com/story/housing-market-is-tipping-in-favor-of-buyers-real-estate-agents-say-2019-03-21).
Read:Forget everything you've heard about first-time homebuyers. They're doing all right (http://www.marketwatch.com/story/forget-everything-youve-heard-about-first-time-homebuyers-theyre-doing-all-right-2019-04-08).
-Andrea Riquier; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
April 20, 2019 15:37 ET (19:37 GMT)
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