Mortgage rates unlock the 5% mark first time in a decade

Apr. 14, 2022 10:12 AM ETREZ, REM, HOMZ, XHB, NVR, BLD, TOL, LEN, DHIBy: Khyathi Dalal, SA News Editor4 Comments

Woman hand hold a red arrow graph with growing value and shopping cart and home model put in inside in the office, Buy or sell a house and real estate for working capital concept.

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  • 30-year fixed-rate mortgage averaged 5.00% with an average 0.8 point for the week ending Apr. 14, 2022, up from last week when it averaged 4.72%; higher than 3.04% a year ago, according to the Freddie Mac Primary Mortgage Survey.

  • "As Americans contend with historically high inflation, the combination of rising mortgage rates, elevated home prices and tight inventory are making the pursuit of homeownership the most expensive in a generation," Chief economist Sam Khater commented.
  • 15-year fixed-rate mortgage averaged 4.17% with an average 0.9 point, up from last week when it averaged 3.91% and a year ago at this time, the 15-year FRM averaged 2.35%.
  • 5-year Treasury indexed hybrid adjustable-rate mortgage averaged 3.69% with an average 0.3 point, up from last week when it averaged 3.56% and a year ago at this time, the 5-year ARM averaged 2.80%.
  • Spring boarding from its all-time lows just 15-months ago, mortgage rates have seen the fastest increase in 20+ years; 30-year rate was under 3% for more than half of 2021.
  • While reporting its quarterly earnings, Wells Fargo said that it issued more mortgages than any other U.S. bank in 2021 and mortgage originations fell 27% from a year ago; JP Morgan Chase said its mortgage originations dropped 37%.
  • The Mortgage Bankers Association said it expects overall mortgage originations, which include refinancing loans, to total $2.58T in 2022, a 35.5% Y/Y decline; prior forecast stood at $2.61T.
  • MBA chief economist Michael Fratantoni said, "Even though existing sales volume will be slightly lower than last year, the continued growth in new home sales and the rapid rise in home prices should deliver a smaller, but solid, 4% annual growth in purchase origination volume."
  • Homebuilding stocks: (LEN), (TOL), (BLD), (NVR)
  • ETFs Watch: (XHB), (HOMZ), (REM), (REZ)
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