Rates on the most popular types of mortgages eased down and continued to confound expectations, according to HSH.com's Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages (FRMs) fell by seven basis points (0.07 percent) to 4.31 percent. Conforming 5/1 Hybrid ARM rates decreased by just two basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 3.14 percent.
"The investor rush into stocks has cooled for the moment, and there are plenty of other concerns to keep markets on the defensive," said Keith Gumbinger, vice president of HSH.com. "Although the U.S. economy seems to be picking up some momentum, the effects of slower growth in China and the unstable situation in Ukraine are all contributing to the ongoing bid for Treasury debt, driving yields down and pulling mortgage rates down too."
Fixed mortgage rates have largely been range bound since last November, but have been holding closer to the bottom of this range over the past month. This has occurred despite an improving outlook for the domestic economy after a weak first quarter.
"Interest rates are moving lower even after April's strong employment report and additional data showing an improving manufacturing sector," adds Gumbinger. "It's unlikely that the economy and rates can continue to move in opposite directions indefinitely, and I'm beginning to wonder if there might be some pressure on rates building that might result in an abrupt rather than gradual upward move before too long."
Average mortgage rates and points for conforming residential mortgages for the week ending May 06, according to HSH.com:
Conforming 30-year fixed-rate mortgage
►Average rate: 4.31 percent
►Average points: 0.15
Conforming 5/1-year adjustable-rate mortgage
►Average rate: 3.14 percent
►Average points: 0.08
Average mortgage rates and points for conforming residential mortgages for the previous week ending April 29 were, according to HSH.com:
Conforming 30-year fixed-rate mortgage
►Average rate: 4.38 percent
►Average points: 0.16
Conforming 5/1-year adjustable-rate mortgage
►Average rate: 3.16 percent
►Average points: 0.08
