After being stuck at 3.53 percent for three weeks, the average rate on the 30-year fixed-rate mortgage (FRM) moved up 3.56 percent, with an average 0.8 point, the week ending Feb. 21, according to Freddie Mac’s weekly Primary Mortgage Market Survey.
A year ago, it the 30-year rate averaged 3.95 percent.
However, economic conditions continue to point to flat or falling interest rates in the near future.
First, economic trouble abroad is likely to keep downward pressure on interest rates at home. France’s economic output fell to a two-month low in February and the euro fell nearly 1 percent Feb. 20 to a six-week low against the dollar.
Meanwhile, U.S. consumers are tightening budgets following the end of the two-year payroll tax “holiday” that expired this year, reducing paychecks by about $50 a week. Higher gasoline prices are also forcing consumers to spend less.
For the 5-year Treasury-indexed hybrid adjustable rate mortgage (ARM), the average interest rate was 2.64 percent, with an average 0.5 point, also unchanged from last week, and down from the average 2.80 percent a year ago.
Finally, for the week ending Feb. 21, Freddie Mac reported the 1-year Treasury-indexed ARM averaged 2.65 percent, with an average 0.4 point, up from 2.61 percent last week, and down from 2.73 percent a year ago.