Wednesday, December 24, 2014

"Mortgage Rates Match December Highs"

by Bill McBride on 12/24/2014 07:37:00 PM

30 year mortgage rates moved up a little today, but are way down from 4.60% a year ago.

From Matthew Graham at Mortgage News Daily: Mortgage Rates Match December Highs

Mortgage rates continued higher today as lenders opted for typically conservative holiday pricing strategies. The bond markets that most directly influence mortgage rates improved slightly from yesterday's precipitous weakness. Normally, those underlying market movements do more to move rates than anything else, but in cases where lenders are getting caught up to abrupt market changes or when they're protecting against uncertainty associated with long holiday weekends, their individual strategies can result in higher rates in spite of market movements suggesting lower rates. That's the case today, and it puts the average conforming 30yr fixed rate quote at 4.0%, matching the previous high from December 5th.

There's no way to know if rates will move higher or lower next week (don't expect much change this Friday). What we do know is that rates would improve if trading levels merely held flat between now and then. In other words, there's a bit of extra negativity baked into current rate sheets, and if markets manage to hold their ground or improve heading into the new year, we would get some of the recent losses back. To be clear, that's something that makes sense to HOPE for, but isn't justification to forgo locking your rate unless you're prepared to lock at even higher rates if the market happens to move against you.
Here is a table from Mortgage News Daily: