Rates for home loans sank as investors re-assessed earlier bets that President Trump’s agenda would stir stronger inflation, mortgage finance provider Freddie Mac said Thursday.
The 30-year fixed-rate mortgage averaged 4.23%, down 7 basis points during the week. The 15-year fixed-rate mortgage averaged 3.44%, down from 3.50% last week.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.24%, down from 3.28% last week.
Those rates don’t include fees associated with obtaining mortgage loans.
The 10-year Treasury
yield fell about 10 basis points during the week as markets became increasingly uncertain about Washington’s ability to enact health care policy changes. Many analysts and investors see success with that legislation as a litmus test for the tax reform and fiscal stimulus measures that President Trump and Congressional Republicans have promised.
Mortgage rates generally follow the trajectory of Treasury yields, though that relationship has been more shaky this year.
Many economists believe a firmer U.S. economy and more Federal Reserve rate hikes will likely bring about slightly higher mortgage rates in 2017. Thursday’s level for the benchmark 30-year fixed-rate mortgage is lower than the 4.32% at which it ended 2016 but higher than the 3.65% average for all of 2016 – the lowest since Freddie began keeping records in 1971.