Having dropped to an all-time low of 3.29 percent last week, the average rate for a benchmark 30-year mortgage has since inched up 7 basis points to 3.36 percent but remains 95 basis points below its mark at the same time last year and well below an average of over 6 percent over the past 30 years, according to Freddie Mac’s latest Mortgage Market Survey data.

At the same time, the average rate for a 15-year fixed mortgage slipped another 2 basis points to 2.77 percent, which isn’t a record low but is 99 basis points (0.99 percentage points) below its mark at the same time last year, while the average rate for a 5-year adjustable dropped 17 basis points to 3.01 percent, which is 83 basis points below its mark at the same time last year.

And with the Fed having already implemented an emergency rate cut of 50 basis points last week, the probability of another rate cut by the end of the year is holding at 100 percent, according to an analysis of the futures market.

6 thoughts on “Benchmark Mortgage Rate Inches Up, Short-Term Rates Drop”
  1. In related news, despite the Fed having taken another emergency action this afternoon in an attempt to increase liquidity and quell market fears, the Dow Jones Industrial Average dropped another 10 percent and the S&P 500 closed down 9.5 percent. As such, the two indices are down 28 and 27 percent, respectively, since peaking last month.

    At the same time, the yield on the 10-year Treasury has actually ticked up around 20 10 basis points since the mortgage rates above were collected.

    1. And with the Dow Jones Industrial Average and S&P 500 both having rebounded from yesterday’s losses (but still 25 and 22 percent below peak, respectively), the yield on the 10-year Treasury jumped over 20 basis points today and closed at 0.981 percent.

  2. Interesting article here that suggests if mortgage rates were tracking to “normal” gaps to the treasury yields, then rates should be at 2.24%. Over 48 yrs, the spread has been 1.7% and today it is at 2.82%. Other words, banks are taking a particularly large profit out of the existing situation and should come down further in a competitive environment – never minding that in all likelihood rates will continue to plunge as treasury marches towards zero.

    1. Or perhaps there’s some signaling with respect to an increase in the risk premium, versus simply profit, between the two?

      Regardless, the 10-year yield is currently around 0.9 percent and has actually been ticking up, not down, over the past week.

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