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Mortgage Rates Retreat for First Time in 3 Weeks According to Bankrate.com Weekly National Survey

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NEW YORK, NY – Mortgage rates avoided a third straight increase, with the benchmark 30-year fixed mortgage rate sliding to 3.77 percent, according to Bankrate.com’s weekly national survey. The 30-year fixed mortgage has an average of 0.20 discount and origination points.

The larger jumbo 30-year fixed held steady at 3.76 percent, while the average 15-year fixed mortgage pulled back to 3.01 percent. Adjustable mortgage rates were also lower, with the 5-year ARM and 7-year ARM each reversing course to 3.14 percent and 3.37 percent, respectively.    

After moving higher in each of the two preceding weeks, mortgage rates retraced some of that ground. The pullback in mortgage rates started in immediate response to last week’s Federal Open Market Committee meeting where the Fed was tight-lipped about interest rate intentions. That, coupled with some evidence of weakness in the U.S. economy – such as the 0.5 percent growth rate in the first quarter – kept mortgage rates on the downswing over the past week. The opposite can also happen though, if a strong jobs report heats up talk of a summer rate hike by the Fed, both bond yields and mortgage rates would trend higher in coming weeks. Mortgage rates are closely related to the yields on long-term government bonds.

At the current average 30-year fixed mortgage rate of 3.77 percent, the monthly payment for a $200,000 loan is $928.50. 

SURVEY RESULTS

30-year fixed: 3.77% — down from 3.83% last week (avg. points: 0.20)
15-year fixed: 3.01% — down from 3.05% last week (avg. points: 0.16)
5/1 ARM: 3.14% — down from 3.21% last week (avg. points: 0.21)

Bankrate’s national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in 10 top markets.

For a full analysis of this week’s go in mortgage rates, go to www.bankrate.com

The survey is complemented by Bankrate’s weekly Rate Trend Index, in which a panel of mortgage experts predicts which way the rates are headed over the next seven days. Half of the panelists predict mortgage rates to continue falling, while one-third expect mortgage rates to remain more or less unchanged in the coming week. Just 17 percent forecast a rebound in mortgage rates in the next seven days.

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Are Millennials Itching to Leave Downtown?

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(RECAP: A recent USC housing expert’s study reveals that Millennials have begun moving out of downtown area and into more single-family homes as the market loosens and the economy improves. Millennials in cities nationwide have flocked to fill downtown apartments over the past decade, but the study predicts that the real estate market should brace for a major migration out of core urban areas. Last year marked a major turning point as the country’s urban centers reached “peak” millennial saturation. The study, published in the journal Housing Policy Debate, examined population data in the American Community Survey, the Current Population Survey; building permit data from the U.S. Census Bureau; and employment data from the Bureau of Labor Statistics, as well as surveys by the National Association of Realtors.)

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FHFA Again Eases Up on Multifamily Cap for GSEs

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(RECAP: The FHFA announced Wednesday it had raised a cap on the amount of multifamily loans Fannie Mae and Freddie Mac can buy from lenders, boosting it to $35 billion effective immediately. The adjustment from the previous cap of $31 billion is warranted “based on increased estimates of the overall size of the 2016 multifamily finance market,” the agency said. The cap is supposed to ensure the government-sponsored enterprises don’t crowd private investors out of the multifamily market. The multifamily cap was set last May when FHFA chose to exclude subsidized affordable housing, manufactured housing communities, small multifamily properties (5-50 units) and certain other affordable rentals from the limit. Those exclusions will remain in place. Due to these exclusions, Fannie financed $42.3 billion in multifamily loans and Freddie financed $47.3 billion in 2015 without exceeding the cap. The Mortgage Bankers Association welcomed FHFA’s choice.)

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