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Mortgage Rates Today, Sept. 2: Up Again, Renter Confidence Shaky

Sept. 2, 2016
Mortgage Rates, Mortgages
Mortgage Rates Today, Sept. 2: Up Again, Renter Confidence Shaky
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Thirty-year and 15-year mortgage rates inched up, but 5/1 ARM loan rates remained the same on Friday, according to a NerdWallet survey of mortgage rates published by national lenders this morning.

Rates have been edging up ever since Fed Chair Janet Yellen hinted that a federal funds rate hike might be on the horizon. Although mortgage rates are creeping higher, they are still well below 4% as we head into the slower home-selling months.

Zillow: Renters fear inability to buy a home

Homeowners are feeling bullish about selling their homes, but renters aren’t so confident that the market is on their side so they can join the ranks of homeowners, according to the latest Zillow Housing Confidence Index.

Just 38% of renters surveyed said now is a good time to buy a home, and about 50% of renters in the nation’s priciest housing markets (San Francisco and New York) aren’t sure they’ll be able to afford a home down the road. Nearly half of the renters surveyed in Seattle, Boston and San Jose, California, reported similar fears.

Conversely, high confidence among homeowners is being bolstered by rising home values and buyer demand, with the most confident homeowners concentrated in Western and Southwestern cities. Seven out of every 10 homeowners surveyed said now is a good time to sell a home, Zillow found.

Home prices are at or over peak levels in about a quarter of U.S. markets, Zillow said. That’s good news, signaling the continued market recovery since the housing crisis that led to a swath of depressed home values and distressed sales nationwide.

But many renters, especially in the most expensive metro markets, might have a harder time finding an affordable home and saving for a large down payments — issues that will only be compounded if interest rates go up.

“The overall health of the housing market looks great at first glance, but dig a bit deeper you’ll find inequality between renters and homeowners,” Zillow chief economist Svenja Gudell said in a news release. “Even though the majority of homeowners are confident and believe now is a good time to sell, they’re holding off because they expect home values to continue to appreciate and want to ride the wave.”

The NerdWallet Mortgage Rate Index compiles annual percentage rates — lender interest rates plus fees, the most accurate way for consumers to compare rates. Here are today’s average rates for the most popular loan terms:

Mortgage Rates: Sept. 2, 2016

(Change from 9/1)

30-year fixed: 3.66% APR (+0.02)

15-year fixed: 3.08% APR (+0.01)

5/1 ARM: 3.54% APR (NC)

Homeowners looking to lower their mortgage rate can shop for refinance lenders here.

NerdWallet daily mortgage rates are an average of the published APR with the lowest points for each loan term offered by a sampling of major national lenders. Annual percentage rate 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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How to choose the best mortgage

Deborah Kearns is a staff writer at NerdWallet, a personal finance website. Email: [email protected]. Twitter: @debbie_kearns.