Mortgage Rates Rise by Close to Double Digits on Zillow Mortgage Marketplace
30-year fixed mortgage rates climbed by eight basis points on the most updated Zillow Mortgage Marketplace ticker, closing at 4.27 percent (up from 4.19 percent) for the wraparound week ended Tuesday, March 25, 2014.
According to Zillow’s numbers, the average rate on 30-year fixed mortgage products reached as high as 4.33 percent on Thursday, but slipped closer to 4.28 percent, where rates had fluctuated until Tuesday. In addition, Zillow reported that 15-year fixed mortgages averaged 3.22 percent for the recently concluded week, while 5/1 adjustable-rate mortgages closed at 2.87 percent. These rates, while lower than they were in the late summer of 2013, remain much higher than they were at around the same time of the year in 2013.
Commenting on the trends that affected mortgage rates this week, Zillow director of mortgages Erin Lantz said that this was primarily due to the U.S. Federal Reserve recently meeting on when to raise short-term interest rates from near-zero.
“Last week, rates surged after the Federal Reserve suggested it might increase the Federal Funds Rate sooner and more significantly than expected, surprising many market observers who look to this rate for guidance on where mortgage rates are headed,” said Lantz. “This week, we expect rates will inch up further on the momentum of last week’s direction from the Fed and expectations of positive news from economic data scheduled for release.”
Individually, New York (+14 basis points), Illinois (+12 basis points), Massachusetts and Pennsylvania (both +11 basis points) had the most significant increases among major housing markets, while 30-year fixed mortgage rates in New Jersey and Washington state had ticked up by just six hundredths of a percentage point, as per Zillow’s numbers.Tweet