April Job Growth Lifts Mortgage Rates

After spending the last month approaching--and breaking, in some cases--record lows, fixed mortgage rates reversed the trend this week.

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According to ""Freddie Mac's"":http://www.freddiemac.com/ Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 3.42 percent (0.7 point) for the week ending May 9, up from last week, when it averaged 3.35 percent. Last year at this time, the 30-year FRM averaged 3.83 percent.

The 15-year FRM this week averaged 2.61 percent (0.7 point) up several basis points from 2.56 percent in the previous survey.

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At the same time, adjustable rates were mixed. The 5-year hybrid adjustable-rate mortgage (ARM) averaged 2.58 percent (0.5 point) this week, up slightly from 2.56 percent. Meanwhile, the 1-year ARM averaged 2.53 percent (0.4 point), a slip from 2.56 percent last week.

According to Frank Nothaft, VP and chief economist for Freddie Mac, the rise in fixed rates this week was a reaction to April's better than expected ""employment report"":https://themreport.com/articles/payrolls-up-165k-in-april-unemployment-rate-down-to-75-2013-05-03, which showed 165,000 new jobs added (as well as upward revisions in previous months).

""Bankrate.com"":http://www.bankrate.com/ also reported rate increases in its weekly national survey. According to the site, the benchmark 30-year fixed averaged 3.60 percent, up 8 basis points week-over-week, while the 15-year fixed averaged 2.82 percent, up 7 basis points.
The 5/1 ARM average was 2.64 percent, a slight increase over last week.

Mortgage rates had fallen for seven consecutive weeks, to levels that were at, or near, record lows. But the April jobs report was better than expected and helped sway sentiment about the economy,"" Bankrate said in a release. ""So much of the economy's health is gauged by job growth, and this month's report came on the heels of a lousy March jobs report and some other soft economic data in recent weeks.""