Mortgage interest rates rose this week on news of modest hiring by employers and more economic encouragement from the housing sector.
The average rate on the 30-year fixed-rate mortgage (FRM) was 3.41 percent, with an average 0.7 point for the week ending Oct. 25, up from 3.37 percent last week.
The rate was down from 4.10 percent a year ago, according to Freddie Mac’s Primary Mortgage Market Survey.
Meanwhile, weekly applications for unemployment fell last week to a seasonally adjusted 369,000, according to the U.S. Labor Department. Unemployment applications were down by 23,000 from last week and the new level indicates modest hiring.
Nevertheless, the economy isn’t yet quite strong enough to sustain rising mortgage interest rates, which are expected to bounce around in the coming months.
“Not surprisingly, the Federal Reserve, in its October 24th monetary policy announcement acknowledged the further signs of improvement in the housing sector, albeit from a depressed level,” said Frank Nothaft, vice president and chief economist at Freddie Mac.
The average rate on the 15-year FRM was 2.72 percent, with an average 0.6 point, up from 2.66 percent last week. A year ago, the 15-year FRM averaged 3.38 percent.
The average interest rate on 5-year Treasury-indexed, hybrid adjustable rate mortgage (ARM) was 2.75 percent this week, with an average 0.6 point. It was unchanged from last week, though it was 3.08 percent a year ago.
Finally, for the week ending Oct. 25, Freddie Mac reported the 1-year Treasury-indexed ARM averaged 2.59 percent, with an average 0.4 point, down from 2.60 percent last week, and down from 2.90 percent a year ago.