WASHINGTON: Average long-term U.S. mortgage rates rose slightly this week, but remain near historic lows with the spring home-buying season underway and showing strong sales.
Mortgage giant Freddie Mac said Thursday that the national average for a 30-year fixed -rate mortgage increased to 3.68 percent from 3.65 percent last week.
The average rate for a 15-year mortgage, popular with homeowners who refinance, ticked up to 2.94 percent from 2.92 percent.
A year ago, the 30-year mortgage rate averaged 4.29 percent while the 15-year mortgage averaged 3.38 percent.
Rates have remained low despite the Federal Reserve’s decision last year to stop monthly bond purchases meant to hold down long-term interest rates. After a winter in which growth nearly froze, the Fed downgraded its view of the economy on Wednesday and offered no sign that a rate increase might be coming soon.
The 30-year average rate hit a record low 3.31 percent in November 2012. The 15-year average hit bottom at 2.56 percent in May 2013.
Data issued Wednesday by the National Association of Realtors showed that more Americans signed contracts to buy homes in March, the third straight month of gains as housing heats up with the start of the buying season. The increase in signed contracts indicates that robust hiring and low mortgage rates are encouraging more Americans to buy homes, after years of waiting to save for down payments and rebuild their credit in the wake of the housing bust and 2008 financial crisis.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage was 0.6 point this week, unchanged from last week. The average fee for a 15-year mortgage also remained at 0.6 point.
The average rate on a five-year adjustable-rate mortgage ticked up to 2.85 percent from 2.84 percent last week, and the fee rose to 0.5 point from 0.4 point. For a one-year ARM, the average rate increased to 2.49 percent from 2.44 percent last week; the fee was unchanged at 0.4 point.