Average US 30-year mortgage edges up to 3.56 per cent

WASHINGTON – Long-term U.S. mortgage rates rose this week but remain at levels low enough to boost home sales in the spring buying season.

Mortgage buyer Freddie Mac says the average 30-year fixed-rate mortgage edged up to 3.56 per cent from a 52-week low of 3.54 per cent last week. The rate is down from 4.02 per cent a year ago.

The average rate on the 15-year fixed rate mortgage also rose — to 2.83 per cent from a 52-week low of 2.81 per cent. A year ago, the 15-year rate stood at 3.21 per cent.

Worries about the global economy — and specifically that the United Kingdom might vote Thursday to leave the European Union — have sent investors scurrying to the relative safety of U.S. Treasury bonds. Their purchases have driven rates lower. And long-term mortgage rates track the yield on 10-year Treasury notes.

Last week, the Federal Reserve decided to keep short-term rates unchanged at 0.25 per cent to 0.50 per cent.

“The low rates continue to be good news for the housing market,” said Sean Becketti, chief economist at Freddie Mac.

The National Association of Realtors reported Wednesday that sales of existing homes rose in May to the highest level since February 2007. But the Commerce Department reported Thursday that new-home sales dropped 6 per cent in May, though they are up 6.4 per cent so far this year.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 per cent of the loan amount.

The average fee for a 30-year mortgage rose to 0.6 point from 0.5 point last week. The fee for a 15-year loan was steady at 0.5 point.

Rates on adjustable five-year mortgages averaged 2.74 per cent this week, same as last week. The fee remained at 0.5 per cent.