December 20, 2015
Friday, December 18, 2015
Fixed mortgage rates are ticking slightly higher in response to the Federal Reserve’s decision to raise short-term interest rates, but they will remain at historically low levels for some time to come, according to Freddie Mac’s recent Primary Mortgage Market Survey® (PMMS®).
“As was almost-universally expected, the Federal Open Market Committee (FOMC) of the Federal Reserve elected this week to raise short-term interest rates for the first time since 2006,” explains Sean Becketti, Freddie Mac’s chief economist. “We take the Fed at its word that monetary tightening in 2016 will be gradual, and we expect only a modest increase in longer-term rates. Mortgage rates will tick higher but remain at historically low levels in 2016. Home sales will remain strong, but refinance activity should cool somewhat.”
According to Freddie Mac’s survey, the average 30-year fixed-rate mortgage (FRM) stands at 3.97 percent with an average 0.6 point; the 15-year FRM averages 3.22 percent with an average 0.5 point. The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averages 3.03 percent, with an average 0.4 point, and the 1-year Treasury-indexed ARM averages 2.67 percent with an average 0.2 point.
Source: Freddie Mac
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