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Mortgage rates hit reverse in the week ending 21st January, ending a run of 2nd consecutive weekly gains. 30-year fixed rates fell by 2 basis points to 2.77%.
Compared to this time last year, 30-year fixed rates were down by 83 basis points.
30-year fixed rates were down by 217 basis points since November 2018’s last peak of 4.94%.
Economic Data from the Week
Through the 1st half of the week, there were no material stats to provide U.S Treasury yields with direction.
From elsewhere, 4th quarter GDP numbers from China impressed through had a muted impact.
News of a new wave of the COVID-19 pandemic in China muted the impact of the numbers at the start of the week. Concerns over a reintroduction of containment measures tested support for riskier assets.
A continued rise in new COVID-19 cases across the U.S also pinned back yields in the week. Expectations of a sizeable U.S stimulus package and an aggressive vaccination drive in the U.S provided support, however.
Freddie Mac Rates
The weekly average rates for new mortgages as of 21st January were quoted by Freddie Mac to be:
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30-year fixed rates slipped by 2 basis points to 2.77% in the week. This time last year, rates had stood at 3.60%. The average fee remained steady at 0.7 points.
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15-year fixed rates fell by 2 basis point to 2.21% in the week. Rates were down by 83 basis points from 3.04% a year ago. The average fee fell from 0.7 points to 0.6 points.
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5-year fixed rates slid by 32 basis points to 3.80%. Rates were down by 48 points from 3.28% a year ago. The average fee remained unchanged at 0.4 points.
According to Freddie Mac,
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Rates have hovered near historic lows for almost a year, fueling purchase and refinance activity amid the COVID-19 pandemic.
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In recent weeks, however, rates have begun to fluctuate as political and economic factors drive yields higher.
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Freddie Mac continues to forecast rates to remain relatively low this year, however. The FED is expected to keep interest rates anchored to near zero for a longer period of time until the economy rebounds.
Mortgage Bankers’ Association Rates
For the week ending 15th January, the rates were:
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Average interest rates for 30-year fixed to conforming loan balances increased from 2.88% to 2.92%. Points increased from 0.33 to 0.37 (incl. origination fee) for 80% LTV loans.
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Average 30-year fixed mortgage rates backed by FHA increased from 2.93% to 3.01%. Points fell from 0.32 to 0.29 (incl. origination fee) for 80% LTV loans.
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Average 30-year rates for jumbo loan balances increased from 3.17% to 3.19%. Points remained unchanged at 0.28 (incl. origination fee) for 80% LTV loans.