Long-term Rates Tick Up, Short-term Rates at Record Lows

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According to Freddie Mac's (OTC: FMCC) latest Primary Mortgage Market Survey  (PMMS), the 30-year fixed-rate mortgage rate rose slightly for the first time in five weeks. The 15-year fixed-rate mortgage rate also rose slightly while the 5-year ARM and 1-year ARM fell.
 
Freddie Mac's chief economist Frank Nothaft said, "Mixed inflation signals kept fixed mortgage rates at bay this week. The headline producer price index jumped 0.4 percent between August and September, which was quadruple the market consensus, while the consumer price index fell below the market forecast. Rates on the traditional 1-year and 5-year hybrid ARMs eased to all-time record lows."
 
Report Highlights Include:

• 30-year fixed-rate mortgage (FRM) averaged 4.21 percent with an average 0.8 point for the week ending October 21, 2010, up from last week when it averaged 4.19 percent. Last year at this time, the 30-year FRM averaged 5.00 percent.

• 15-year FRM this week averaged 3.64 percent with an average 0.7 point, up from last week when it averaged 3.62 percent. A year ago at this time, the 15-year FRM averaged 4.43 percent.

• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.45 percent this week, with an average 0.6 point, down from last week when it averaged 3.47 percent. A year ago, the 5-year ARM averaged 4.40 percent. The 5-year ARM has not been lower since Freddie Mac started tracking it in January 2005.

• 1-year Treasury-indexed ARM averaged 3.30 percent this week with an average 0.7 point, down from last week when it averaged 3.43 percent. At this time last year, the 1-year ARM averaged 4.54 percent. The 1-year ARM has not been lower since Freddie Mac started tracking it in January 1984.

Nothaft further commented, "Meanwhile, the housing construction market is showing some signs of promise. New construction on one-family homes rose 4.4 percent in September to the strongest pace since May. In addition, homebuilder confidence rose in October to the strongest level since June, according to the NAHB/Wells Fargo Housing Market Index."
 



Freddie Mac defines its regions as follows:

Northeast: NY, NJ, PA, DE, MD, DC, VA, WV, ME, NH, VT, MA, RI, CT
Southeast: NC, SC, TN, KY, GA, AL, FL, MS, PR, VI
North Central: OH, IN, IL, MI, WI, MN, IA, ND, SD
Southwest: TX, LA, NM, OK, AR, MO, KS, CO, NE, WY
West: CA, AZ, NV, OR, WA, UT, ID, MT, HI, AK, GU

 

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