Average interest rates on 30-year U.S. mortgages rose for a ninth straight week, hitting their highest since September 2003, according to data from mortgage finance company Freddie Mac Thursday.
U.S. 30-year fixed rate mortgages averaged 6.36 percent in the week ending Nov. 10 -- the highest since hitting an average of 6.44 percent in the Sept. 5, 2003 week -- from 6.31 percent a week earlier.
“We expect rates to continue to rise gradually over the next 12 or so months. Because the housing sector is so sensitive to fluctuations in interest rates, this will have the effect of returning the housing sector to a more normal pace of activity, by historical standards,” Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.
Fifteen-year mortgages averaged 5.89 percent in the latest week, up from 5.85 percent. It was the highest since the week ended July 19, 2002, when they averaged 5.93 percent.
Freddie Mac said one-year adjustable-rate mortgages averaged 5.12 percent in the latest week, up slightly from the previous week’s 5.09 percent.
A year ago, 30-year mortgage rates averaged 5.76 percent, 15-year mortgages 5.16 percent and the ARM 4.16 percent.
“News that wages grew faster than had been expected in October reinforced fears of inflation in the financial markets, and that bumped up interest rates again this week,” Nothaft said.
“(October) Consumer Price Index and Producer Price Index figures due out next week will help to confirm or deny whether market concerns are warranted,” he said.
Lenders charged an average of 0.5 percent in fees and points on 30-year mortgages, unchanged from last week. They charged 0.6 percent on 15-year mortgages and the one-year ARM, both up from 0.5 percent.
The hybrid “5/1” ARM, set at a fixed rate for five years and then adjustable each year following, averaged 5.81 percent, up from 5.76 percent a week ago, Freddie Mac said.
Freddie Mac is a mortgage finance company chartered by Congress that buys mortgages from lenders and packages them into securities to sell to investors or to hold in its own portfolio.