30-year fixed mortgage interest rates continued to decline in January, inching closer to 5%, according to two weekly rate surveys released today. Despite this, Freddie Mac’s (FRE) chief economist, Frank Nothaft, tells HousingWire that he expects interest rates overall will increase over the course of 2010, but not to a point where borrowers should worry about massive fluctuations. Freddie Mac’s weekly survey put the average 30-year fixed-rate mortgage interest rate (FRM) at 5.06% with a 0.7 origination point for the week ending January 14. That’s a decrease from a week ago when the rate was 5.09%, but above last year’s 4.96%. Bankrate.com’s survey of large banks and thrifts put the 30-year FRM at 5.23% with a 0.47 point, down from 5.26% a week ago and 5.28% one year ago. But Nothaft said the small incremental weekly changes should only have a marginal impact on whether or not someone decides to buy. “At the margin, it has some effect, but when we’re talking three to five basis points, that’s not a large change on a week-to-week basis,” he said. “For the large majority of borrowers shopping for a mortgage, five basis points won’t matter.” Freddie Mac said the 15-year FRM was 4.45% with an average 0.6 point, down from last week’s 4.5% and last year’s 4.65%. Bankrate.com put the 15-year FRM at 4.62%, down from 4.67% a week ago. Freddie put the five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.32% this week, down from last week when it averaged 4.44%. The one-year Treasury-indexed ARM averaged 4.39% this week with an average 0.5 point, up from last week when it averaged 4.31%, Freddie added. Bankrate.com said the average five-year ARM rate was 4.68%, down from 4.74% last week. “I haven’t really found a measurable seasonality in interest rates,” Nothaft told HousingWire. “There’s a huge, pronounced, substantial seasonality in home sales, housing construction, prices and all that. But you don’t see it in interest rates and mortgage rates.” Seasonal changes in sales volume doesn’t impact mortgage rates because of the breadth and depth of capital markets, Nothaft said. “There’s a very elastic supply of funds to support mortgage lending and the whole idea of elastic supply is that it can expand and contract very easily and readily to meet the needs of lenders and consumers with no material impact on interest rates,” he said. Nothaft projects the trend of extremely low rates will continue at least for the next few months. “Our projection for the course of the year is for long-term interest rates to gently and gradually rise a little bit higher over the course of the year,” Nothaft said. “So not immediately, not in the next few weeks, or the next couple of months, but gradually as the economy begins to improve and capital markets start to improve further, we do see some gradual, gentle, upward pressure on yields.” Write to Austin Kilgore. The author held no relevant investments.