The latest Freddie Mac Primary Mortgage Market Survey (PMMS) shows the 30-year fixed-rate mortgage rose 0.25% to an average of 4.42%. A year ago at this time, 30-year mortgage rates averaged 3.17%.
One industry analyst said the latest numbers point to a quickly accelerating decline in the refinance market. The number of high-quality candidates plummeted by 50% in March alone.
An almost quarter-percent increase also hit the 15-year fixed-rate mortgage sector from last week, when it averaged 3.39 percent. It is now 3.63%. A year ago at this time, the 15-year FRM averaged 2.45%.
The Freddie Mac survey also showed the five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.36%, up from last week when it averaged 3.19%. A year ago at this time, the five-year ARM averaged 2.84%
“This week, the 30-year fixed-rate mortgage increased by more than a quarter of a percent as mortgage rates across all loan types continued to move up,” said Sam Khater, Freddie Mac’s chief economist, in a news release. “Rising inflation, escalating geopolitical uncertainty and the Federal Reserve’s actions are driving rates higher and weakening consumers’ purchasing power. In short, the rise in mortgage rates, combined with continued house price appreciation, is increasing monthly mortgage payments and quickly affecting homebuyers’ ability to keep up with the market.”
The Freddie Mac numbers point to a weakening of the refinance marketplace not seen in three-and-a-half years, said Andy Walden, vice president of enterprise research and strategy, for Black Knight Financial Services, Inc., a provider of software, data and analytics. "The latest numbers from Freddie have cut the high-quality refinance candidate population to just over 2 million. That’s down 80% from the start of the year – with a 50% drop in March alone," said Walden.
"The last time the population was this small was back in Oct/Nov 2018, when rates had climbed above 4.8%. Should they pull the trigger on a refi, these two million candidates could benefit from an aggregate potential $635 million monthly savings, or about $312 a month per borrower," Walden added.
