Mortgage rates continued their upward trend last week, with rates on 30-year fixed-rate mortgages on the rise this week.
In general, rates have risen steadily in September, with the 30-year fixed-rate at 4.576%, according to the BankingMyWay Weekly Mortgage Rate Tracker. Back on Aug. 30, the same index pegged the 30-year rate at 4.445%.
The rate increase follows a spate of generally good news on the U.S. economy in recent weeks. That trend is already continuing this week, with a research report from Barclays Capital that shows third-quarter U.S. gross domestic product will be higher than the second quarter of 2010.
A cynic might say with at a 1.6% growth rate in quarter two, the GDP has no room to go but up. But healthier business inventories, a more favorable trade deficit and stronger manufacturing growth will make sure the U.S. grows instead of weakens in the third quarter, and that’s going to impact mortgage rates.
For starters, a bigger GDP would put to rest talk of any double-dip recession. Economic trajectories may be based on pure scientific data, but there’s little question that the human element — especially consumer confidence — factors into the equation, too.Lately, that sentiment has been showing signs of growing stronger — or at least consumer sentiment isn’t all negative these days, as it was for much of this spring. The new Fannie Mae (Stock Quote: FNM) National Housing Survey bears that out.
A wide majority (78%) of survey respondents told Fannie Mae researchers that home prices will either rise or remain flat over the next year — a five-point rise from January. Also, 70% of respondents said it’s a good time to buy a house, and that’s up six points from the beginning of the year. The bad news is that 83% of respondents say it’s a bad time to sell a house.