New housing data causes mortgage rates to climb
Posted on Thursday, March 27, 2014 at 2:09:38 PM
Changes in residential financing rates are closely linked to fluctuations within the housing market, as well as any statements made by the Federal Reserve. Recently, several of these factors caused rates to start a slight climb upward.
According to Freddie Mac, the 30-year fixed-rate mortgage averaged 4.40 percent for the week ending March 27, compared to the previous week's 4.32 percent. The 15-year FRM also increased, now averaging 3.42 percent compared to 3.32 percent.
"Mortgage rates rose following the uptick on the 10-year Treasury note after comments by the Federal Reserve Board Chair Janet Yellen indicated a possible increase in interest rates as soon as early 2015," explained Frank Nothaft, vice president and chief economist at Freddie Mac. "Also, the S&P/Case-Shiller 20-city composite house price index rose 13.2 percent over the 12-months ending in January 2014."
On the other hand, the Mortgage Bankers Association reported that residential financing applications dropped near the end of March. For the week ending March 21, applications were 3.5 percent below levels hit only one week prior. In addition, conventional refinance applications saw an 8.1 percent decline during that time.