A recent uptick in Treasury rates likely will slow the drop in mortgage rates over the next few weeks, Freddie Mac says.
Mortgage rates were mostly flat this week, remaining below 3%. “However, there are some interesting compositional shifts, as the 10-year Treasury rate has increased modestly over the past month while mortgage spreads have declined,” notes Sam Khater, Freddie Mac’s chief economist. “Spreads may decline even further, but the rise in Treasury rates will make it difficult for mortgage rates to fall much more over the next few weeks.”
Ultra-low mortgage rates are prompting existing- and new-home sales to increase to pre-pandemic levels, the National Association of REALTORS® reports. Mortgage rates have plunged nearly 80 basis points since the beginning of the year, which translates to a decrease in monthly mortgage payments of $120 for the typical American, NAR reports.
Freddie Mac reports the following national averages with mortgage rates for the week ending Sept. 3:
30-year fixed-rate mortgages: averaged 2.93%, with an average 0.8 point, up slightly from a 2.91% average last week. The all-time record low for 30-year rates was 2.88%, set at the beginning of August. A year ago, 30-year rates averaged 3.49%.
15-year fixed-rate mortgages: averaged 2.42%, with an average 0.8 point, falling from last week’s 2.46% average. A year ago, 15-year rates averaged 3%.
5-year Treasury hybrid adjustable-rate mortgages: averaged 2.93%, with an average 0.2 point, rising from last week’s 2.91% average. A year ago, 5-year ARMs averaged 3.30%.
Source: Freddie Mac