Benchmark Mortgage Rate Drops, Odds of Easing Emerge

by SocketSite

Source: SocketSite

Having dropped to a 9-month low at the beginning of the year, the average rate for a benchmark 30-year mortgage, which hit a 7-year high of 4.94 percent this past November, has inched down another 4 basis points to a 10-month low of 4.41 percent, according to Freddie Mac’s latest Mortgage Market Survey data.

At the same time, the average rate for a 15-year fixed mortgage has dropped to 3.84 percent, which is 7 basis points above its mark at the same time last year but down 52 basis points since mid-November, while the average rate for a 5-year adjustable has inched up to 3.91 percent, which is now 34 basis points above its mark at the same time last year and an inverted 7 basis points above the 15-year rate.

And with the Fed having formally signaled a more “patient” approach with respect to any future rate hikes, the probability of a hike this year has dropped to around 5 percent, with the possibility of an easing now approaching 20 percent, according to an analysis of the futures market.

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