With long-term bonds trading in a narrow band, home loan rates likely have settled in ahead of the Federal Reserve meeting next week. While most observers do not expect the Fed to raise rates in November, they are anticipating a rate hike in December.
At the same time, the financial markets appear reluctant to make any moves ahead of the presidential election, which means mortgage rates are likely to hold steady at least until after Nov. 8.
Bankrate.com, which puts out a weekly mortgage rate trend index, found that 80 percent of the experts it surveyed believe rates will remain unchanged in the coming week, moving less and plus or minus two basis points. (A basis point is 0.01 percentage point.)
The 15-year fixed-rate average slipped to 2.78 percent with an average 0.5 point. It was 2.79 percent a week ago and 2.98 percent a year ago.
The five-year adjustable rate average inched down to 2.84 percent with an average 0.4 point. It was 2.85 percent a week ago and 2.89 percent a year ago.
“Mortgage rates continue to be relatively stable and at near record lows,” Sean Becketti, Freddie Mac chief economist, said in a statement. “The 30-year fixed-rate mortgage fell 5 basis points week-over-week to 3.47 percent, erasing last week’s increase. At the same time, the 10-year Treasury yield ended the week relatively flat – up about 2 basis points.”
Meanwhile, mortgage applications declined this week, according to the latest data from the Mortgage Bankers Association.
The refinance share of mortgage activity accounted for 62.7 percent of all applications.