Mortgage rates to start to rise in the near future.
Poli Mortgage Group
Mortgage rates have started to rise with expectations of a possible rate increase by the Federal Reserve, according to the latest Primary Mortgage Market Survey (PMMS) posted by Freddie Mac.
In early November rates fell slightly lower with market expectations of no rate increase by the Fed, but thanks to a recent comment from Fed Chair Janet Yellen, rates may start to trend higher. Speaking earlier this month before the House Financial Services Committee, Yellen formalized the possibility of a rate hike in December, telling the Committee that December’s meeting is a “live possibility” for a rate increase.
The 30-year fixed-rate mortgage averaged 3.87% for the week ending Nov. 5, 2015, up from last week when it averaged 3.76%. A year ago at this time, the 30-year FRM averaged 4.02%.
The 15-year FRM this week averaged 3.09%, up from last week when it averaged 2.98%. A year ago at this time, the 15-year FRM averaged 3.21%.
In addition, the 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 2.96% this week, up from last week when it averaged 2.89%. A year ago, the 5-year ARM averaged 2.97%.
The 1-year Treasury-indexed ARM averaged 2.62%, up from 2.54% last week. At this time last year, the 1-year ARM averaged 2.45%.
2016 MORTGAGE RATES TO RISE, SAY CONSUMERS
U.S. consumers expect mortgage rates to rise through the rest of 2015 and into next year.
According to Fannie Mae's National Housing Survey, a survey of 1,000 households, 50% of U.S. consumers think mortgage rates are on the way up, and another 37% believe rates will stay above 4 percent.
The survey is meant to measure changing consumer attitudes toward housing and mortgages nationwide. Rising rates are expected to fuel this year's existing and new home sales; and next year's sales as well.
With conventional 30-year fixed rate mortgage rates currently averaging near 4 percent, homes are going under contract at their fastest rate in a decade.
Key Announcements to watch in November:
November 25th – October New Home Sales
November 30th – October Pending Home Sales
November 30th – October Cost of Funds Index (COFI)