Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), showing mortgage rates continuing to follow bond yields higher amid improving economic data. The average 30 fixed-rate mortgage (FRM) averaged 4.08 percent for the week with an average 0.8 point for the week ending March 22, 2012, up from last week when it averaged 3.92 percent. Last year at this time, the 30-year FRM averaged 4.81 percent. This marks the first week since Oct. 27, 2011, that the 30-year FRM cleared the four percent mark when the FRM averaged 4.10 percent.
The 15-year FRM averaged 3.30 percent for the week, with an average 0.8 point, up from last week when it averaged 3.16 percent. A year ago at this time, the 15-year FRM averaged 4.04 percent.
"Mortgage rates are catching up with increases in U.S. Treasury bond yields placing the average 30-year fixed mortgage rate above four percent for the first time since the end of October 2011," said Frank Nothaft, vice president and chief economist, Freddie Mac. "Bond yields rose over the past two weeks in part due to an improving assessment of the state of the economy by the Federal Reserve, better than expected results of commercial bank stress tests and the likelihood of a second bailout for Greece."
The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.96 percent this week, with an average 0.7 point, up from last week when it averaged 2.83 percent. A year ago, the five-year ARM averaged 3.62 percent. The one-year Treasury-indexed ARM averaged 2.84 percent this week with an average 0.6 point, up from last week when it averaged 2.79 percent. At this time last year, the one-year ARM averaged 3.21 percent.
"Meanwhile, consumers continued to reduce their debt burdens in the fourth quarter of 2011," said Nothaft. "For instance, homeowners reduced their financial obligations ratio (debt payments as a share of disposable income) to the lowest point since the second quarter of 1994."
