Published 2/14/2014 in Business
WASHINGTON (AP) — The average U.S. rate on a 30-year fixed mortgage edged up this week to 4.28 percent from 4.23 percent but remains near historically low levels after declining the previous five weeks.
The average for 15-year loans was unchanged at 3.33 percent, mortgage buyer Freddie Mac said Thursday.
Mortgage rates have risen about a full percentage point since hitting record lows about a year ago. The increase was driven by speculation that the Federal Reserve would reduce its $85 billion a month in bond purchases. The Fed proceeded last month with planned reductions of its bond purchases, which has helped keep long-term interest rates low.
Recent economic data have pointed to a likely pause in the housing market's recovery. Real estate data provider CoreLogic reported last week that U.S. home prices slipped from November to December. And the year-over-year increase slowed, likely a result of weaker sales at year end.
The number of Americans signing contracts to buy homes has plummeted to its lowest level in more than two years.
Most economists expect home sales and prices to keep rising this year, but at a slower pace. They forecast that both will likely rise around 5 percent, down from double-digit gains in 2013.
To calculate average mortgage rates, Freddie Mac surveys lenders between Monday and Wednesday each week. The average doesn't include extra fees — points, — usually needed to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage was unchanged at 0.7 point. The fee for a 15-year loan also remained at 0.7 point. The average rate on a one-year adjustable-rate mortgage rose to 2.55 percent from 2.51 percent. The average fee declined to 0.4 point from 0.5 point.
The average rate on a five-year adjustable mortgage fell to 3.05 percent from 3.08 percent.
The fee held at 0.5 point.
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