Mortgage Interest Rates Dip Slightly As omicron uncertainties Linger
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Mortgage interest rates drop slightly as the market awaits new information about the omicron variant.
According to latest data from Freddie Mac Primary Mortgage Market Survey, the average rate on a 30-year fixed mortgage rate decreased slightly to 3.1% this week from 3.11% annual percentage rate (APR) for the week ending Dec. 9. This is an increase from 2.71% at the same time in 2021.
The survey report noted:
“Mortgage rates have moved sideways over the last several weeks, fluctuating within a narrow range. Going forward, the path that rates take will be directly impacted by more information about the Omicron variant as it is revealed and the overall trajectory of the pandemic. In the meantime, rates remain low and stable, even as the nation faces declining housing affordability and low inventory.”
| Loan Term | Rate | Change | Last Week |
| 30-Year Fixed | 3.1% | 0.01% | 3.11% |
| 15-Year Fixed | 2.38% | 0.01% | 2.39% |
| 5/1 ARM Rates | 2.45% | 0.04 | 2.49% |
| Source: Freddiemac.com | |||
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Mortgage interest rates hold steady
The 30-year fixed rate saw a slight drop from 3.11% last week to 3.1% this week. The 52-week low is 2.65%. This means that borrowers with a 30-year fixed-rate mortgage of $100,000 will pay approximately $432 per month in principal and interest (excluding taxes and fees) at today’s interest rate of 3.1%. The total interest paid over the life of the loan will be about $57,268.
The 15-year mortgage rate also saw a slight drop, down from 2.39% last week to 2.38%, according to the Freddie Mac survey. This is up from 2.26% at a similar time last year. The 52-week low is 2.10%. The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) also dropped from 2.49% last week to 2.45%. This is down from 2.79% the same time last week. The 52-week low for the ARM is 2.40%.
This suggest that mortgage interest rates held steady this week, “marking the fourth consecutive week of mostly sideways movement,” said George Ratiu, Realtor.com manager of economic research. According to Ratiu, investors responded to the report on job openings which suggests that there is widespread labor shortage that is likely to exert overhead pressure to wages as we move into 2022.
It is worth noting even though rates are at historic lows, they could start rising soon. Therefore, borrowers are advised to take advantage of the current rates through refinancing. This could help them to get lower monthly mortgage repayments over the loan term.
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