Rates on the most popular types of mortgages firmed up for the first time since mid-September, according to HSH.com's Weekly Mortgage Rates Radar. In the last week, the average rate for conforming 30-year fixed-rate mortgages (FRMs) rose by three basis points (0.03 percent) to 4.04 percent. Conforming 5/1 Hybrid ARM rates also increased by three basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 3.05 percent.
"Of late, the stock market has resumed an upward climb, and underlying interest rates have moved higher," said Keith Gumbinger, vice president of HSH.com. "Safe harbor purchases of U.S. Treasuries are fine when things are turbulent, but as markets settle, low-yield bonds don't have much holding power. In calmer times, investors tend to move money out of bonds and back into stocks, hoping for better returns, and lifting interest rates a bit."
Mortgage rates seem poised to firm a little bit more in the days ahead. The influential 10-year Treasury yield has quietly moved upward in recent days, suggesting that the small uptick in rates will continue as the week progresses.
"Although it may be 'psychologically important' or at least headline-generating when interest rates break a whole number, such as falling below four percent as they have recently, there is little practical difference for a homeowner or homebuyer if average interest rates are 3.99 percent or 4.01 percent," said Gumbinger. "A few dollars per month one way or the other shouldn't hinder a homebuyer, and even a less-valuable refinance still has value, so the message remains constant: If you can grab a mortgage at these interest rate levels, do it."
Average mortgage rates and points for conforming residential mortgages for the week ending October 28, according to HSH.com:
Conforming 30-year fixed-rate mortgage
►Average rate: 4.04 percent
►Average points: 0.15
Conforming 5/1-year adjustable-rate mortgage
►Average rate: 3.05 percent
►Average points: 0.11
Average mortgage rates and points for conforming residential mortgages for the previous week ending October 21 were, according to HSH.com:
Conforming 30-year fixed-rate mortgage
►Average rate: 4.01 percent
►Average points: 0.13
Conforming 5/1-year adjustable-rate mortgage
►Average rate: 3.02 percent
►Average points: 0.11
