3.98: Mortgage Rates Jump Back Up; New Home Sales Fall

• January 26, 2012
• 1 Comment

by Shilpi Paul

After three straight weeks of record setting lows, mortgage rates jumped back up today.

This morning, Freddie Mac reported 3.98 percent with an average 0.7 point as the average on a 30-year fixed mortgage. Rates hit a record low of 3.88 percent last week and have been below 4 percent now for eight consecutive weeks.

From Freddie Mac vice president and chief economist Frank Nothaft:

Fixed mortgage rates ticked up this week as the housing market ended 2011 on a high note. New construction of one-family homes rose 4.4 percent in December to an annualized rate of 470,000, the most since April 2010. Existing home sales increased 5.0 percent at the end of the year to 4.61 million houses, the largest amount since May 2010.

At the same time that the rates were announced, not-so-good news came from the Commerce Department, which reported that new home sales fell unexpectedly in December by 2.2 percent. Sales were at an annual rate of 307,000, below the 325,000 number that economists had expected.

Here’s a look at the path of rates since last January:

This article originally published at http://dc.urbanturf.com/articles/blog/3.98_mortgage_rates_jump_back_up/5000

1 Comment

1. df said at 1:18 am on Friday January 27, 2012:

   No doubt we can thank the December deal which provided a two-month extension of the payroll tax cut for the recent bump in mortgage rates.  To finance the extension, in part, Title IV of the extension bill, called “Mortgage Fees and Premiums,” raised the risk-based fees that Fannie Mae and Freddie Mac charge to back home mortgages, for the first time imposing it on borrowers with high credit scores if their loan-to-value ratio exceeds 75 percent. I suspect that the looming implementation (in Feb) of these fees by Fannie and Freddie has, as expected, added an eight to a quarter point to the interest rates on mortgages.

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