Mortgage rates are on track to finish the week below where they started by several basis points. This is great news for anyone who is considering buying a new home or refinancing their current mortgage. Tomorrow’s monthly jobs report could cause rates to adjust, though, so it’s important to keep an eye out for any changes. Read on for more details.
Where are mortgage rates going?
Rates down a little
While mortgage rates have risen in the Freddie Mac PMMS this week (see below), data for that report is collected early on in the week and doesn’t necessarily reflect current market conditions.
There was a pretty significant move into in afternoon trading on Tuesday, which continued into Wednesday, sending yields lower.
The yield on the 10-year Treasury note (which is the best market indicator of where mortgage rates are going) is down almost eight basis points from its high point on Monday.
Mortgage rates typically move in the same direction as the 10-year yield, so if the present trend holds we’ll see rates lower in next week’s Freddie Mac PMMS.
Of course, the biggest economic report of the week–the monthly jobs report for November–will be released tomorrow morning, and could definitely cause rates to adjust.
Freddie Mac Primary Mortgage Market Survey
The Freddie Mac PMMS got released today and it’s showing that mortgage rates rose a little bit from the previous week. Here are the numbers:
- The average rate on a 30-year fixed rate mortgage rose four basis points to 3.94% (0.5 points)
- The average rate on a 15-year fixed rate mortgage increase six basis points to 3.36% (0.5 points)
- The average rate on a 5/1-year adjustable rate mortgage moved up by three basis points to 3.35% (0.3 points)
Here is the assessment this week from Freddie Mac’s Economic & Housing Research group:
“This week’s survey reflects last week’s uptick in long-term interest rates, with the 30-year fixed mortgage rate up 4 basis points to 3.94 percent. The 30-year mortgage rate has been bouncing around in a 10 basis point range since September.
While long-term rates have been relatively steady week-to-week, shorter term interest rates have been on the rise. The spread between the 30-year fixed mortgage and the 5/1 Hybrid ARM rate was 59 basis points this week, down 43 basis points from earlier this year. With a narrower spread between fixed and adjustable mortgage rates, more borrowers are opting for a fixed product. The MBA reported earlier this week that the ARM share of conventional mortgage applications was 16.7 percent, down from over 20 percent in the spring.”
Mortgage rates have been on a downward trend since Tuesday afternoon but are poised to rise over the coming weeks and months. We believe that the prudent decision for anyone looking to refinance or purchase is to lock in a rate sooner rather than later.
Today’s economic data:
Applications for U.S. unemployment benefits came in at 236,000 for the week of 12/2/17. That’s a little below both the consensus and the prior reading.
- New York Fed President William Dudley at 8:30am
Notable events this week:
- Factory Orders
- International Trade
- PMI Services Index
- ISM Non-Mfg Index
- ADP Employment Report
- Productivity and Costs
- EIA Petroleum Status Report
- Jobless Claims
- Employment Situation
- Consumer Sentiment
Filed Under: Current Mortgage Rates, Mortgage Interest Rates, Mortgage Rate Trends and Analysis, Mortgage Rates, Rates
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