With the spring home-buying season starting, a slight drop in the mortgage rates across America has been noted. This is according to the latest survey of Freddie Mac, a mortgage buyer.
Data shows that from a 4.41 percent average rate last week on a 30-year fixed mortgage, there is already just a 4.34 percent average rate this week. However, compared to figures from last year by only 3.43 percent, the current one still proves to be higher.
Moreover, a small dip was also noted in the 15-year fixed mortgage average rate at 3.38 percent from 3.47 percent last week. But still, this does not compare to the record low of 2.62 percent last year.
Freddie Mac also showed data that this week’s averages for the 5-year ARM and the 1-year ARM, the two most popular hybrid adjustable-rate mortgages, have also declined slightly. The 5-year ARM went from 3.12 percent last week to 3.09 this week. The 1-year ARM, on the other hand, is also now at 2.41 percent from 2.45 percent.
Frank Nothaft, Vice President and Chief Economist at Freddie Mac, says that mortgage rates have eased after the decline in the 10-year Treasury yields. He also added that the economy also has affected the decline in that for one, the 192,000 jobs added in March were below the forecasted figures, and two, the unemployment rate remained at 6.7 percent.
Right now, analysts are not sure of whether mortgage rates will improve next week or not. Based on the Mortgage Rate Trend Index, only 24 percent of analysts are hopeful that mortgage rate becomes better next week. Some 38 percent believe it will continue to dwindle while the remaining 38 percent hope that it will remain steady.
Jim Sahnger, mortgage planner from Schaffer Mortgage in Palm Beach Gardens, FL., believes mortgage rates will improve as shown in some improvements after the release of the employment report.