Mortgage rates moved off of their all-time low this week as a result of reports that Pfizer's coronavirus vaccine was potentially 90% effective, according to Freddie Mac.
"Despite this rise, mortgage rates remain about a percentage point below a year ago and the low rate environment is supportive of both purchase and refinance demand," Sam Khater, Freddie Mac's chief economist, said in a press release. "Heading into late fall, the housing market continues to grow and buttress the economy."
The 30-year fixed-rate mortgage averaged 2.84% for the week ending Nov. 12,
The 15-year fixed-rate mortgage averaged 2.34%, up from last week when it averaged 2.32%. A year ago at this time, the 15-year fixed-rate mortgage averaged 3.2%.
The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.11% with an average 0.4 point, up from last week when it averaged 2.89%. A year ago at this time, the five-year adjustable-rate mortgage averaged 3.44%.
"In a topsy turvy week for markets, mortgage rates ultimately finished the last seven days above where they started, as investors reacted strongly to the initial federal election results and encouraging news regarding a COVID-19 vaccine," Matthew Speakman, an economist with Zillow, said in his weekly comment issued Wednesday night.
"While economic data have improved, they’ve included very few surprises for investors to react to, meaning most reports have already been priced in by the time the data are released. That changed this week, however," he noted. Bond yields first dropped following the initial uncertainty surrounding the election, which was expected and had been priced into the market. The Pfizer news was unexpected and as a result, investors took money out of bonds and that moved the yield higher.
"Mortgage rates followed suit, rising firmly in recent days. The movement was a stark reminder of the influence the coronavirus — and our ability to contain it — has on the direction of financial markets going forward. This budding optimism regarding a treatment for the virus is likely to continue to nudge mortgage rates higher in the near term, barring any setbacks," Speakman said.
