Fixed-mortgage rates climbed higher for the sixth consecutive week amid a solid employment report for May. Regardless, mortgage rates are coming off all-time record lows, which is helping to keep homebuyer affordability high, Freddie Mac said in a report Thursday.
Since beginning to climb last month, the 30-year, fixed-rate mortgage has increased over half a percentage point. The 30-year FRM came in at 3.98%, up from 3.91% last week, compared to 3.71% last year, Freddie noted in its Primary Mortgage Market Survey.
The 15-year, FRM increased to 3.10%, up from 3.03%, while rising from 2.98% last year.
Meanwhile, the 5-year Treasury-indexed adjustable-rate mortgage averaged 2.79%, up from 2.74% and down from 2.8% a year ago.
Additionally, the 1-year Treasury-index ARM remained unchanged at 2.58% this week, the same as last week and was also down from 2.78% a year earlier.
“Fixed mortgage rates crept up further this week following a solid employment report for May. The economy added 175,000 new jobs and the number of discouraged workers fell by 780,000 to the fewest since September 2009. And although the unemployment rate ticked up to 7.6 percent, it was due to a 420,000 increase in the size of the labor force; the underemployment rate fell from 13.9 to 13.8 percent in May,” said Frank Nothaft, vice president and chief economist for Freddie Mac.
He added, “With the ongoing run up in fixed mortgage rates, adjustable-rate mortgages (ARMs) are becoming more popular among homeowners looking to refinance and for home purchasers. The 30-year fixed mortgage rate this week is 0.6 percentage points above the recent low set over the week ending May 2nd. In comparison, the share of conventional mortgage applications for ARMs rose from 13 percent of dollar volume at the beginning of May to 17 percent last week, according to the Mortgage Bankers Association.”
Bankrate data also shows mortgage rates inching upward.
Bankrate’s 30-year, FRM increased to 4.14% from 4.1% a week earlier.
In addition, the 15-year, FRM increased to 3.32%, up from 3.28%, while the 5/1 ARM rose to 3% from 2.93%.