Mortgage rates showed little movement for the week, as concerns over increasing coronavirus numbers tempered promising economic news, according to the latest data from Freddie Mac.
The 30-year fixed-rate mortgage average inched up one basis point to 2.87% for the weekly period ending August 26. The rate came in at 2.86%
“The tug-of-war between the economic recovery and rising COVID-19 cases has left mortgage rates moving sideways over the last few weeks,” said Sam Khater, Freddie Mac’s chief economist.
This year’s
Recent spikes in coronavirus cases have also dampened much of the optimism from earlier this year, and will continue to apply downward pressure, according to Zillow economist Matthew Speakman.
But changes to monetary policy that would lead to increasing rates are likely in the offing, according to some experts. Those changes include
Economists expect announcements made by Fed Chair Jerome Powell at the
“More definitive insight regarding the Fed’s inevitable plans to tighten monetary policy should result in a meaningful increase in rates, depending on how surprising Chair Powell’s announcement is,” said Speakman. “That said, should the Fed stop short of announcing plans to taper, mortgage rates would likely revert to recent lows.”
The other major interest rates also only showed slight one-basis-point changes week-over-week. The average 15-year fixed-rate mortgage climbed to 2.17% from 2.16%, while the rate stood at 2.46% one year ago.
The 5-year Treasury-indexed adjustable-rate mortgage edged downward to 2.42%, compared to 2.43% the prior week. In the same week of 2020, the 5-year ARM averaged 2.91%.
The rates still offer borrowers a window of opportunity to refinance, according to Khater, and home buyers would benefit as well — when they can find
“The major obstacle to higher home sales remains very low inventory for consumers to purchase,” he said.