Interest rates are low, and probably will remain that way as long as inflation remains low. That is the information coming from the Federal Reserve Board.
Current Federal Reserve Chairman Janet Yellen has noted in the past that the low interest rate policy embraced over the past few years by the central bank supports the recovery’s efforts, and in her estimation is the surest path to getting the nation back to a more normal monetary policy.
The Federal Reserve has kept interest rates near zero since the onset of what has been termed the Great Recession.
12 Weeks Below 4 Percent for Mortgage Rates
With interest rates lows, mortgage rates are low. This is true for Fort Myers luxury homes as well as Coral Springs homes for sale. According to Freddie Mac’s Primary Mortgage Market Survey (PMMS), the weekly mortgage rate presented the following numbers on October 15, 2015:
- 30-year fixed-rate mortgage (FRM): For the week ending in mid-October, the 30-year fixed-rate mortgage averaged 3.82 percent with an average 0.6 point. This is up from the previous week when it averaged 3.76 percent. Looking back one year ago during this same time, the 30-year FRM averaged 3.97 percent. Freddie Mac Chief Economist Sean Becketti noted that with the 30-year mortgage rate climbing 6 basis points to 3.82 percent marks 12 weeks in a row with the rate falling below 4 percent.
- 15-year FRM: The numbers are showing an increase from the week prior. The week ending October 15th had an average of 3.03 percent with an average 0.6 point. This is up from last week when it averaged 2.99 percent. Reflecting on the numbers from one year ago, the 15-year FRM averaged 3.18 percent at this same time.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM): The week of ending October 15th showed an average 2.88 percent with an average of 0.4 point. These numbers remain unchanged from prior reporting last week, and show a slight decrease from just one year ago, with the averaged 5-year ARM at 2.92 percent.
- 1-year Treasury-indexed ARM: This week showed an average of 2.54 percent with an average 0.2 point. This is down from last week that reported 2.55 percent. The 1-year ARM averaged 2.38 percent last year during this time.
Employment Report and Interest Rates
The September employment report was weak, with its numbers showing a steady jobless rate at 5.1 percent. However, when it came to wage gains, the numbers stalled. A shrinking labor force was noted. Plus, there were fewer positions created by employers than there had been in preceding months. This clearly demonstrated a slowdown in the nation’s job market.
The Federal Reserve must have seen the country’s recovering economy as too fragile since it decided to hold interest rates low, even for Fort Myers luxury homes.
There had been a hint that interest rates might be climbing toward the end of the year and an increase might come before the year’s end. Experts now predict that these lagging signs may push any interest rate rise into 2016, which could affect the mortgage rate on Coral Springs homes for sale.
Federal Reserve Governor Daniel Tarullo hinted that the Federal Reserve may wait the year out without making any significant rate changes.
