Weekly Mortgage Rates Radar: New Year Slippage For Rates

Rates on the most popular types of mortgages edged downward, according to HSH.com com's Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages fell by two basis points (0.02 percent) to 4.06 percent. Conforming 5/1 Hybrid ARM rates also decreased by two basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 3.27 percent.

"Financial markets are coming back up to speed after the holidays, but not necessarily liking what they see," said Keith Gumbinger, vice president of HSH.com. "The ongoing slowdown in China and more troubles in U.S. manufacturing have produced unsettled markets to start the year, with investors showing some new appetite for the safety of U.S. Treasury bonds, helping yields and mortgage rates to fall."

Although the Federal Reserve began a rate-rising campaign, investors don't yet appear convinced that short-term rates will be lifted very fast or very far this year. Meanwhile, the Fed's program of reinvestment continues to keep at least some downward pressure on long-term interest rates, helping to anchor mortgage rates at present levels.

"Without an accumulation of strong economic news it will be hard for fixed-rate mortgage rates to rise very much," adds Gumbinger. "Friday's employment report will provide key clues as to whether the expansion is only trudging along or accelerating. More trudging, and rates should hold and perhaps ease a little; accelerating, and rates will tend to firm up a bit. Regardless, they're not going anywhere very fast at the moment."

Average mortgage rates and points for conforming residential mortgages for the week ending Jan. 5, according to HSH.com:

Conforming 30-year fixed-rate mortgage

Average Rate: 4.06 percent

Average Points: 0.17

Conforming 5/1-year adjustable-rate mortgage

Average Rate: 3.27 percent

Average Points: 0.08

Average mortgage rates and points for conforming residential mortgages for the previous week ending December 29 were, according to HSH.com:

Conforming 30-year fixed-rate mortgage

Average Rate: 4.08 percent

Average Points: 0.21

Conforming 5/1-year adjustable-rate mortgage

Average Rate: 3.29 percent

Average Points: 0.11