Mortgage Rates Rise as Home Price Increases Slow
Lenders continue to increase mortgage rates this week as home price increases are cooling. Average 30 year mortgage rates today are at 3.56 percent, an increase from last week's average 30 year mortgage rate of 4.47 percent. The most recent home price report released by CoreLogic showed home prices increasing 12.7 percent year over year in July.
Home Price Increases Slowing
Another report that included data for the month of August released by Clear Capital showed home prices increasing only 10.2 percent. The National Association of Realtors released a report showing contracts to buy existing homes dropped 1.3 percent in July, the largest monthly decline in 2013.
The double digit price increases of 2012 and 2013 are not sustainable so the slowing down of home price increases come as no surprise. In the coming months, home price increases will fall back to the single digits, probably in a range of 8 percent and even lower in 2014. The historical norm for home price increases is around 1 percent above the rate of inflation.
Low Inflation Will Keep Home Prices Increase in Single Digits
The current inflation rate is 1.7 percent and the Federal Reserve's long term goal for inflation is around 2.00 percent. In the coming years home price increases will fall to around 3.00 percent. The one factor that could slow the rate of growth for home prices is sharply higher mortgage rates.
Current mortgage rates on 15 year conforming loans are averaging 3.56 percent, up from last week's average 15 year mortgage rate of 3.49 percent. Searching our rate database for a 30 year refinance loan, you'll find lenders offering refinance rates as low as 3.00 percent with mortgage points and as low as 3.25 percent with no mortgage points.
Mortgage Rates Today on Jumbo Loans
Jumbo mortgage rates today on 30 year loans are averaging 4.79 percent, an increase from the previous week's average 30 year jumbo rate of 4.69 percent. In our rate database for 30 year jumbo loans we see lenders quoting jumbo rates as low as 4.00 percent with mortgage points and as low as 4.375 percent with zero points.
Today's mortgage rates on 15 year jumbo loans are averaging 4.13 percent, up from the prior week's average 15 year jumbo rate of 4.04 percent. Right now the lowest 15 year jumbo refinance rates available in our database are much lower at 3.675 percent with points and at 3.75 percent with no points.
Current Adjustable Mortgage Rates
Average 5 year conforming adjustable mortgage rates are at 3.64 percent, up from last week's average 5 year adjustable mortgage rate of 3.52 percent. The lowest 5 year adjustable refinance rates in our database are over 100 basis points lower at 2.375 percent with points and at 2.60 percent with no points.
5 year jumbo adjustable mortgage rates currently are averaging 3.24 percent, which is lower then last week's average 5 year jumbo adjustable rate of 3.30 percent. The lowest 5 year jumbo refinancing rates in our database right now are at 2.60 percent with no points.
Average Mortgage Rates