Rates rise for 30-year mortgages

WASHINGTON — Rates on 30-year mortgages climbed for a third straight week, pushing the level to the highest point this year.

Freddie Mac’s weekly survey released Thursday showed that rates on 30-year, fixed rate mortgages averaged 5.79 percent for the week ending March 1, up from 5.69 percent last week.

It was the third consecutive weekly increase after 30-year mortgages had fallen for six straight weeks, hitting a low for this year of 5.57 percent the week of Feb. 10. Rates now stand at the highest level since the 30-year mortgage averaged 5.81 percent during the last week of 2004.

Analysts said the latest rate increase occurred because bond market investors are becoming concerned that long-term rates are too low in view of signals from Federal Reserve policy-makers that they intend to keep pushing short-term rates higher to make sure inflation stays under control.

Sales of both new and existing homes set records in 2004 for the fourth straight year. But analysts are forecasting a slight falloff in the sales pace this year as rates continue rising.

Rates on 15-year, fixed-rate mortgages, a popular option for refinancing, rose to 5.33 percent this week, up from 5.22 percent last week. Rates on one-year adjustable-rate mortgages edged down slightly to 4.14 percent, compared to 4.16 percent last week.

Five-year hybrid adjustable-rate mortgages averaged 5.17 percent this week, up from 5.05 percent last week. These hybrid mortgages have a fixed-rate for five years and then adjust each year after that.