Mortgage rates climb for third consecutive week
Posted on Thursday, March 17, 2016 at 11:01:46 AM
After two months of surprising falls, mortgage rates are moving in a steadily upward direction. Freddie Mac released the results of its Primary Mortgage Market Survey on Thursday, showing that the 30-year fixed-rate mortgage had risen for the third week in a row to average 3.73 percent for the week ending March 17. One year ago, the 30-year FRM averaged 3.78 percent.
"Treasury yields increased heading into this week's FOMC meeting, partially in response to modestly higher inflation readings," said Sean Becketti, chief economist for Freddie Mac. "Nonetheless, at the meeting the Fed confirmed what the market had already concluded and made no change to the Federal funds target. The Fed went further and acknowledged that economic signals have been mixed and that the pace of monetary tightening may be slower than had been assumed at the end of 2015."
As residential financing rates kept pace with market currents, mortgage applications made some moves of their own. According to the Mortgage Bankers Association, applications fell 3.3 percent from one week prior on a seasonally adjusted basis. A 6 percent drop in the Refinance Index explains much of the decline, though it was offset somewhat by a percentage point gain in the Purchase Index.
Refinancing as a share of overall mortgage activity is now at its lowest level since August 2015, at 55 percent of total applications. The share of applications for FHA loans, meanwhile, slid slightly from 12 percent one week ago to 11.7 percent for the week ending March 11.