Mortgage Rates Up Slightly For the Week

U.S. mortgage rates hit their highest levels since November this week, according to the weekly survey conducted by the government-backed industry giant Freddie Mac, which was released on Thursday.

The average home loan rate on a 30-year fixed-rate mortgage came in at 6.23 percent for the week ending January 18, up from last week’s average of 6.21 percent. The mortgage averaged 6.10 percent a year ago.

The 15-year fixed-rate home loan, a popular mortgage refinancing option, averaged 5.98 percent for the week, up from last week’s 5.96 percent average. The mortgage averaged 5.67 percent a year ago.

The five-year, U.S. Treasury-indexed hybrid adjustable-rate mortgage (hybrid ARM) averaged 6.04 percent, compared with last week’s 6.03 percent average. The ARMs averaged 5.75 percent a year ago.

One-year Treasury-indexed ARMs averaged 5.51 percent for the week, up from last week’s 5.44 percent average. These ARMs averaged 5.18 percent a year ago.

The upward drift in mortgage loan costs followed some positive economic reports, Frank Nothaft, Freddie Mac vice president and chief economist, said in a news release.

“Shoppers bustling through the holiday season boosted December’s retail sales above consensus expectations. Concurrently, industrial production reversed a three-month decline and rose faster than anticipated,” he said.

Another contributor to interest rate movements, which heavily influence the direction of mortgage rates, is inflation expectations.

“In the coming year, we expect inflation on average to remain moderate at 2.5 percent, barring shocks from the energy sector, but concerns over the level of core inflation will continue to cause home loan rates to fluctuate,” Nothaft said.

To obtain the rates, the 30-year and 15-year fixed-rate mortgages, as well as the 5-year ARM, required payment of an average 0.4 points.

The 1-year ARM required an average 0.5 points. A point is typically 1 percent of the mortgage amount, and is charged as prepaid interest.

In a separate survey released Wednesday, the Mortgage Bankers Association found that the volume of mortgage applications for the week ending January 12 decreased by a seasonally-adjusted rate of 0.6 percent. The MBAA survey covers about half of all U.S. retail residential loan originations.