One-Year ARM At Highest Level In Almost Seven Years
McLEAN, VA -- Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market SurveySM (PMMSSM) in which the 30-year fixed-rate mortgage (FRM) averaged 6.71 percent, with an average 0.5 point, for the week ending June 22, 2006, up from last week's average of 6.63 percent. Last year at this time, the 30-year FRM averaged 5.57 percent. The 30-year FRM has not been higher since May 31, 2002, when it averaged 6.76 percent. The average for the 15-year FRM this week is 6.36 percent, with an average 0.5 point, up from last week's average of 6.25 percent. A year ago, the 15-year FRM averaged 5.16 percent. The 15-year FRM has not been higher since May 17, 2002, when it averaged 6.37 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.32 percent this week, with an average 0.6 point, up from last week when it averaged 6.23 percent. A year ago, the five-year ARM averaged 5.05 percent. This is the highest the 5-year ARM has been since Freddie Mac started tracking it on January 6, 2005. One-year Treasury-indexed ARMs averaged 5.75 percent this week, with an average 0.8 point, also up from last week when it averaged 5.66 percent. At this time last year, the one-year ARM averaged 4.23 percent. The 1-year ARM has not been higher since August 3, 2001, when it averaged 5.77 percent. "Financial markets believe that the current rate of inflation is above the Fed's comfort zone, which will lead to more rate hikes in the near future," said Frank Nothaft, Freddie Mac vice president and chief economist. "A rate hike in June is thought to be a sure thing, and what was believed to be a vaguely possible hike in August is now considered to be highly likely; that change in market expectations caused mortgage rates to jump higher this week." |
