Mortgage rates level out as housing market improves

The rate for the 30-year mortgage stays below 4%

Mortgage rates level out as housing market improves

Mortgage rates for the week ending Dec. 19 held steady from the week before, according to Freddie Mac.

The Primary Mortgage Market Survey showed that the 30-year fixed-rate mortgage (FRM) averaged 3.73%, unchanged from a week ago but lower compared to 4.55% last year at this time.

“The economy continued to pick up momentum with a solid increase in residential construction, improvement in industrial output in our nation’s factories, and a rise in job openings,” said Sam Khater, chief economist at Freddie Mac. “While the economy is in a sweet spot, improvements in housing market sales volumes will be modest, heading into next year simply due to the lack of available inventory.”

The 15-year FRM also did not budge from the prior week’s average of 3.19%. A year ago, the 15-year FRM was 4.01%.

Meanwhile, the 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) edged up from 3.36% from 3.37%. Last year, the 5-year ARM was 4%.

“The demand is clearly not being met for entry-level Millennials and trade-up Generation X home buyers,” Khater said. “If there was more inventory of unsold homes for buyers to choose from, home sales would be rising at a faster rate.”

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