Thirty-year fixed mortgage rates today dipped five basis points, while 15-year fixed loans and 5/1 ARMs also dropped, according to a NerdWallet survey of current mortgage rates published by national lenders Friday morning.
MORTGAGE RATES TODAY, Friday, Feb. 24:
Home prices up at end of 2016 despite higher mortgage rates
Although rising mortgage rates can cause a cooldown in housing activity, home prices actually rose 1.5% in the final quarter of 2016, according to the Federal Housing Finance Agency’s House Price Index, or HPI, released Thursday.
The HPI analyzes home sales prices of Fannie Mae and Freddie Mac mortgages. It revealed that month-over-month home prices also rose, albeit marginally, on a seasonally adjusted basis by 0.4% in December from November. In looking at year-over-year quarterly comparisons, home prices were up 6.2% in the fourth quarter of 2016 from the same time period in 2015, according to an FHFA news release.
In the last three months of 2016, monthly average mortgage rates for 30-year fixed loans spiked sharply, increasing to 4.20% in December, up from 3.47% and 3.77% in October and November, respectively, according to Freddie Mac data.
“Although interest rates rose sharply during the fourth quarter [of 2016], our data show no signs of a home price slowdown,” Andrew Leventis, FHFA deputy chief economist, said in the release.
While higher interest rates can typically slow down the pace of home-buying activity, the market isn’t seeing the much-needed correction in today’s “unusually low inventories” of available homes for sale, Leventis noted.
Rising home prices are a plus for home sellers, but not for cash-strapped home buyers, who face even more limited (and expensive) housing options as prices continue to climb.
Homeowners looking to lower their mortgage rate can shop for refinance lenders here.
NerdWallet daily mortgage rates are an average of the published annual percentage rate with the lowest points for each loan term offered by a sampling of major national lenders. APR quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.
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The article Mortgage Rates Friday, Feb. 24: Lower; Home Prices Climb originally appeared on NerdWallet.
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