Reported Increase in Mortgage Rates
Zillow, a popular real estate website, revealed that 30-year fixed mortgage rates have increased for five out of the last six weeks. This week, real-time estimates indicated that these rates are now at 4.45 percent while they were at 4.37 percent just a week prior.
A representative from Zillow stated his belief that potential homebuyers and refinancers should remain hopeful because, while month-end mortgage rates are a helpful indicator of market status, we should be looking at the market as a whole. Something that might push mortgage rates down, for example, is whether the turmoil in Syria intensifies. If it does, investors might be compelled into safer investments.
Currently, Syria is in the midst of a civil war. The government is being accused of using chemical weapons against civilians, and more than 2 million have fled the country as refugees. Some are calling this “the greatest threat to world peace since the Vietnam war.” The United States has recently begun to implement plans to aid the rebels against President Bashar al-Assad and his forces. Those plans include strikes on Syria. The United Nations says it will only take action if the use of chemical weapons can be confirmed beyond a doubt.
On average, 5,000 citizens are fleeing Syria. What does this mean for the U.S. housing market? Any investments connected to Syria (primarily oil) are considered highly unstable at this point, which may encourage investors to invest their money elsewhere. Freddie Mac and the National Association of Realtors report that pending home sales pulled back in June and July.
Zillow also reported on the 15-year fixed rate which is up 3.41 percent from 3.34 percent a week ago. Other rates such as the 5-1 adjustable rate mortgage are also up from last week. This data has been compiled and averaged out based on thousands of customized mortgage quotes from across the nation.
A prominent investment strategist commented that, “Syria is just a minor causa proxima, and that the real reason we are going lower is that the stock market’s internal energy was totally used up on July 19th followed by the end of the epic 156 session ‘buying stampede’ that ended on Aug. 13.”
Investors, potential homebuyers and refinancers are encouraged to keep a close eye on the situation in Syria, as it is one factor among many that could influence the U.S. housing market. As always, for the best and most up-to-date comparison of mortgage rates from hundreds of lenders across the country, visit our analysis tool on Best Mortgage Rates, Inc.