The last Friday in June saw mortgage rates in the U.S. rise to a 2015 high as bond investors reacted to reports showing the housing market is heating up. The default of Greece on its’ debt softened that blow on Monday morning June 29th, lowering rates slightly.
With Greece, Puerto Rico and Venezuela in trouble, we may see volatility in July. The average rate for a 30-year fixed mortgage was 4.19 percent, up from 4.04 percent last week and surpassing the level at the end of 2014, according to FHLMC (Freddie Mac). Fed Chair Janet Yellen said last week that if the economy continues to improve as she expects, “it will be appropriate at some point this year” to start raising rates. To further support that, signed contracts to buy previously owned homes rose to a nine-year high in April, according to the National Association of Realtors. In late May, home prices and sales of new houses rose at a faster pace than economists expected.
Other reports showed U.S. business investment could pick up in the second half of the year, and consumer confidence improved.
The average rate for a 30-year fixed mortgage probably will reach 4.4 percent by the fourth quarter, according to the Mortgage Bankers Association. It probably won’t break 5 percent until mid-2016, the trade group said in a forecast.
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