As treasury rates continue to head up the average 30-year fixed rate climbed precipitously to 5.95% from 5.45% last week, according to a weekly national survey from Bankrate.com. Mortgage rates are often influenced by treasury rates which have themselves climbed to 4% from 2% just six months ago. Although they have risen so quickly, mortgage rates are still quite a bit lower than they were a year ago when the average 30-year fixed rate was almost 6.5%.
What does this mean for home sellers in the current market? Typically, as rates climb, buyers begin to get off the fence regarding home purchases. Locking in a rate when rates are heading up could mean a savings of thousands of dollars over the life of a mortgage loan. Coupled with other recent good news in the real estate industry it appears that the recovery for the housing market, while still in its infancy, is beginning to at least gain some traction. In May, foreclosure filings fell 6% from April and new construction housing starts boosted production in May at an annualized rate of 532,000, up 17.2% from the revised estimate of 454,000 in April.
