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Mortgage Rates Friday: Up, Along With Rents

Jan. 12, 2018
Mortgage Rates, Mortgages
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The average rate on a 30-year fixed-rate mortgage went up two basis points, the rate for the 15-year fixed also rose two basis points and the 5/1 ARM went up by one basis point, according to a NerdWallet survey of daily mortgage rates published by national lenders Friday.

The average rate on the 30-year fixed is 14 basis points higher than one week ago and two basis points lower than one year ago. A basis point is one one-hundredth of one percent.

The week’s sharp jump in mortgage rates — the 30-year fixed started the week at 4.11% — was capped off by a strong increase in the core consumer inflation rate. The core Consumer Price Index, accounting for all items except food and energy, went up 0.3% in December, according to the Bureau of Labor Statistics. That was the largest increase since January 2017, the BLS said. Core inflation rose 1.8% in 2017, which is below the Federal Reserve’s target of 2%.

Rents rise

In unwelcome news for people who aspire to be homeowners someday, the inflation index for rent went up 0.4% in December, the BLS reported. Rental inflation was up 3.7% in 2017.

However, even as rents rise, it’s still more affordable to rent than to buy in 76% of counties with populations of 1 million or more, according to ATTOM Data Solutions, a property database company. Renting a three-bedroom property is more affordable than buying a median-priced home in the 14 most-populated counties. Renting is cheaper than buying in 30 of the 39 counties with populations of 1 million or more, ATTOM  said.

“And when broken down by population rather than number of markets, this data shows that the majority of the U.S. population — 64% — live in markets that are more affordable to rent than to buy,” Daren Blomquist, vice president of ATTOM Data solutions, said in a news release.


(Change from 01/11)
30-year fixed: 4.24% APR (+0.02)
15-year fixed: 3.87% APR (+0.02)
5/1 ARM: 4.34% APR (+0.01)

NerdWallet daily mortgage rates are an average of the published annual percentage rate with the lowest points for each loan term offered by a sampling of major national lenders. APR quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.


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