The benchmark 30-year mortgage rate continued to hold above 5 percent this week, just below its seven-year high.
The benchmark 30-year mortgage rate fell 3 basis points to 5.01 percent from 5.04 percent, according to Bankrate.com’s latest survey of the nation’s largest mortgage lenders. Meanwhile, the average 15-year fixed rate dipped 2 basis points to 4.39 percent and the rate for 5/1 adjustable-rate mortgages edged down 3 basis points to 4.39 percent.
Interest rates will hold steady at around 5.1 percent in 2019 while total mortgage originations will fall to $1.52 trillion from $1.6 trillion this year, according to the Mortgage Bankers Association’s latest industry forecast announced Tuesday at the organization’s annual conference in Washington, D.C.
The expected decrease in volume will be led by a continued decline in refinance originations, which will plummet by 12.4 percent to $395 billion, the MBA predicts. Purchase origination volume will grow moderately to $1.2 trillion in 2019, a 4.2 percent increase from this year.
Despite slack in existing-home sales, driven by rising home prices and mortgage rates, housing demand will remain strong, said Mike Fratantoni, MBA’s chief economist. A lack of new building is the main barrier creating a bottleneck in housing supply for buyers, he adds.
“The unemployment rate is at its lowest level in almost 50 years, resulting in faster wage growth and more confident homebuyers,” Fratantoni said. “While the Federal Reserve is expected to increase short-term rates further, 30-year mortgage rates should rise only modestly from here. We are seeing some deceleration in the rate of home price growth, but believe this is a healthy pause for the market, as it will allow income growth to catch up to the recent run-up in home values.”
With full employment in play, Fratantoni expects monthly job growth will taper off in 2019, with an average of 120,000, down from monthly gains of 200,000 jobs seen this year.
“The unemployment rate will decrease to 3.5 percent by the end of 2019, which should continue to keep housing demand at a healthy level, ultimately leading to an increase in purchase originations,” Fratantoni said.
Mortgage rates this week
The benchmark 30-year fixed-rate mortgage fell this week to 5.01 percent from 5.04 percent, according to Bankrate’s weekly survey of large lenders. A year ago, it was 4.04 percent. Four weeks ago, the rate was 4.88 percent. The 30-year fixed-rate average for this week is 0.03 percentage points below the 52-week high of 5.04 percent, and is 0.97 percentage points higher than the 52-week low of 4.04 percent.
The 30-year fixed mortgages in this week’s survey had an average total of 0.32 discount and origination points.
Over the past 52 weeks, the 30-year fixed has averaged 4.54 percent. This week’s rate is 0.47 percentage points higher than the 52-week average.
- The 15-year fixed-rate mortgage fell to 4.39 percent from 4.41 percent.
- The 5/1 adjustable-rate mortgage fell to 4.39 percent from 4.42 percent.
- The 30-year fixed-rate jumbo mortgage fell to 4.93 percent from 4.95 percent.
At the current 30-year fixed rate, you’ll pay $537.43 each month for every $100,000 you borrow, down from $539.27 last week.
At the current 15-year fixed rate, you’ll pay $759.38 each month for every $100,000 you borrow, down from $760.40 last week.
At the current 5/1 ARM rate, you’ll pay $500.17 each month for every $100,000 you borrow, down from $501.94 last week.
Results of Bankrate.com’s weekly national survey of large lenders conducted October 17, 2018 and the effect on monthly payments for a $165,000 loan:
| Breakdown | 30-year fixed | 15-year fixed | 5-year ARM |
|---|---|---|---|
| This week’s rate: | 5.01% | 4.39% | 4.39% |
| Change from last week: | -0.03 | -0.02 | -0.03 |
| Monthly payment: | $886.76 | $1,252.98 | $825.28 |
| Change from last week: | -$3.03 | -$1.68 | -$2.93 |
The “Bankrate.com National Average,” or “national survey of large lenders,” is conducted weekly. The results of this survey are quoted in our weekly articles and national media outlets. To conduct the National Average survey, Bankrate obtains rate information from the 10 largest banks and thrifts in 10 large U.S. markets. In the Bankrate.com national survey, our Market Analysis team gathers rates and/or yields on banking deposits, loans and mortgages. We’ve conducted this survey in the same manner for more than 30 years, and because it’s consistently done the way it is, it gives an accurate national apples-to-apples comparison.
