Mortgage rates rose — but just barely — this week, edging above last week’s record lows, according to a Bankrate survey released Wednesday.
The average cost of a 30-year fixed-rate mortgage stood at 3.06 percent, up from from last week’s 3.05 percent, according to Bankrate’s national survey of lenders. The 15-year fixed remained at 2.47 percent, a record low. Bankrate includes origination points and other fees in its figure. The 30-year fixed-rate loans in this week’s survey included an average total of 0.34 discount and origination points.
Mortgage rates have plunged since the coronavirus recession began earlier this year, propping up a surprisingly strong housing market. Home prices kept rising even as unemployment soared. The combination of tight supply and robust demand has sparked bidding wars in many corners of the country.
Defying the economic downturn, home values have been rising. With record-low mortgage rates driving demand, the Mortgage Brokers Association forecasts that mortgage originations will total $3.2 trillion this year, the most since 2003’s $3.8 trillion.
“The economy, labor market and housing market have all seen meaningful rebounds since the onset of the pandemic, but there is still profound uncertainty,” Mike Fratantoni, the Mortgage Bankers Association’s chief economist, said Wednesday. “Additional waves of the virus could lead to further lockdowns and more job market instability. On the other hand, another pandemic-related stimulus package would result in faster economic growth and additional support for the housing market, albeit with slightly more upward pressure on mortgage rates.”
Mortgage experts polled by Bankrate are divided on where they expect rates to go in the coming week. Just over half expect rates to rise, while 29 percent expect a decline.
Ralph McLaughlin, chief economist at real estate technology firm Haus.com, notes the rise in the yield on the 10-year Treasury, which is closely tied to 30-year mortgage rates. “All signs are pointing for a rise in mortgage rates given the recent surge of the 10-year Treasury,” he says.