Amid a week of somewhat brighter economic news, mortgage rates still managed to slip backwards. Some rates — including closely-watched conforming mortgages — continued to stake out new record-low territory, while others settled for only multi-year lows. As far as the markets went, Treasury yields rose late in the week as the Dow Jones Industrial Average actually retook the 8,000 level. Perhaps the week’s decline in mortgage rates and the improvement in stocks was a coincidence, but it was the first week in a while without any major new government initiative to roil the markets.
Overall, fixed-rate mortgages eased back by seven basis points (.07%), closing the first survey week of April at 5.47%, the lowest average rate for HSH’s Fixed-Rate Mortgage Indicator since late June 2003. For its part, the FRMI’s a 5/1 Hybrid counterpart shed six basis points to finish the survey week at 5.24%.
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Conforming 30-year FRM tripped back by four basis points to their latest record-low average, just below 5%. Jumbo 30-year FRMs continued to decline; the week’s 6.44% puts us back at rates last seen two years ago this week.
Since the turn of the decade, some 480 weeks have elapsed. Those contending that jumbo rates are “too high” would do well to learn that only 166 of those 480 weeks have featured an average interest rate below this week’s value — and that the remaining 314 have not only been above (but often well above) today’s figure. As a reference point, we are only about 89 basis points from the decade’s low average for Jumbos, but 253 below the high.
While there are no signs of any imminent economic rebound, we are starting to be more encouraged by little signals that at least some firming is beginning to take place here and there. While there are no guarantees that things will get better, perhaps they may not continue to get worse, either.
One signal was an actual increase in auto sales in March. According to AutoData, 9.8 million cars and trucks (annualized) were sold, which not only was a 700,000 (annualized) increase from February but also bested forecasts of just a 9 million rate. Despite the improvement, sales remain well below levels needed for automakers to be profitable. Still, it does suggest that consumers will respond when financing and job-loss loan payment protections are available. http://www.hsh.com/.
