Mortgage rates pushed higher for the third consecutive week, according to Freddie Mac's Weekly Primary Mortgage Market Survey.
The 30-year average fixed-rate mortgage increased 3 basis points to 3.62 percent from 3.59 percent the previous week. The 15-year average fixed-rate mortgage increased 4 basis points to 2.88 percent from 2.84 percent the previous week.
Both the 30-year and 15-year rate continued to rebound from the year's July 26 low. Since July 26, the 30-year fixed-rate mortgage has increased 13 basis points, and the 15-year fixed-rate mortgage has increased 8 basis points.
"The latest economic indicators point toward low inflation, but gradually stronger economic activity, which placed further upward pressure on long-term Treasury yields and, in turn, fixed mortgage rates," stated Frank Nothaft, Freddie Mac Vice President and Chief Economist, in comments on the PMMS.
The Mortgage Bankers Association's Weekly Mortgage Applications Survey reported a decrease in demand for mortgage loans this week.
The Market Composite Index, which tracks mortgage loan applications in the previous week, fell by 4.5 percent, reflecting a decrease in demand for mortgage loans as rates increased. The MBA's Refinance Index also fell for the week, decreasing 5 percent. Refinancings continued to account for the largest portion of mortgage applications at 81 percent.
The MBA's average contract interest rate for 30-year fixed-rate mortgages on loans below $417,500 was unchanged for the week at 3.76 percent. Average contract mortgage rates for 30-year fixed-rate loans above the $417,500 level decreased 1 basis point to 4.03 percent.
In other real estate news, the National Association of Home Builders released its monthly NAHB/Wells Fargo Housing Market Index findings, and the U.S. Commerce Department released its July New Residential Construction report.
The NAHB/Wells Fargo Housing Market Index showed increased optimism by builders surveyed. The Index increased to 37 in August following three previous monthly gains, marking its highest level since February 2007. According to the NAHB's August report, builders saw increased prospective buyer traffic and stated greater confidence in their future outlook on sales.
"From the builder's perspective, current sales conditions, sales prospects for the next six months and traffic of prospective buyers are all better than they have been in more than five years," said Barry Rutenberg, NAHB Chairman, in comments on the August Index results.
The Commerce Department's July New Residential Construction report reflected the HMI's improvements. According to the New Residential Construction report, the annual rate for building permits increased 6.8 percent, and housing completions also increased 7.1 percent.
A slight slowdown occurred in housing starts, which decreased by 1.1 percent for the month following an increase of 6.8 percent in June. On a one-year basis, housing starts have increased 21.5 percent.
The week's releases showed an overall strengthening in the real estate market, which continues to be driven by builder confidence.
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