Newspaper article THE JOURNAL RECORD

Long-Term Home Mortgage Rates Increase to 7.24%

Newspaper article THE JOURNAL RECORD

Long-Term Home Mortgage Rates Increase to 7.24%

Article excerpt

McLEAN, Va. (Bloomberg) -- U.S. 30-year fixed-rate home mortgage rates edged up this week in response to the recent turmoil in stock markets.

The average rate on a 30-year fixed-rate mortgage rose to 7.24 percent in the week ended Nov. 6 from 7.21 percent the previous week, Freddie Mac said Thursday.

Freddie Mac also reported that the average adjustable mortgage rate mortgage rose to 5.48 percent from 5.46 percent last week. Fifteen-year mortgage rates averaged 6.80 percent, up from 6.76 percent in the previous week. This week, "interest rates rose slightly as investment funds were taken out of the bond market and placed back into the stock market," said Robert Van Order, chief economist at Freddie Mac. A week ago, investors bought bonds as a safe haven -- pushing prices up and yields down -- as the stock market took its worst beating of the decade. The yield on the Treasury's 10-year note, a benchmark for mortgage rates, fell 8 basis points to 5.93 percent in the past two weeks. What will happen next week will depend largely on what today's employment October figures will be, Van Order said. Low mortgage rates, though, have kept the housing market on good footing, even before the recent decline in U.S. stocks. Starts of new housing rose 7.9 percent in September to an annual rate of 1.500 million after falling a revised 5.1 percent to 1.390 million, Commerce Department figures showed. Building picked up in all regions. The government also reported new home sales -- a key barometer of consumer demand -- fell 0.2 percent to a seasonally adjusted annual rate of 800,000 in September after declining a revised 2.3 percent in August to 802,000. New home sales, though, remained on a record-setting path, averaging at an annual pace of 803,000 this year. That's up from last year's 756,000 sales, which was the strongest year in almost two decades. The last time new home sales stayed above the 800,000 mark for four consecutive months -- as they have since June -- was between August and December 1977, a government spokeswoman said. …

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