MCLEAN, Va. - Mortgage rates have ascended for the fifth consecutive week, with the 30-year fixed-rate mortgage (FRM) averaging 6.72 percent, Freddie Mac announced today. This marks the highest level since early August. Amidst a backdrop of significant upcoming economic events, rates are expected to continue their volatile trend.
According to the Primary Mortgage Market Survey® (PMMS®) released on Thursday, the 30-year FRM saw an increase from the previous week's average of 6.54 percent. This time last year, the rate stood at 7.76 percent. The 15-year FRM also experienced a rise, averaging 5.99 percent, up from 5.71 percent last week and down from 7.03 percent a year ago.
Freddie Mac's Chief Economist, Sam Khater, commented on the current state of the mortgage market, noting that while rates are peaking, they are not expected to reach the highs seen earlier in the year. He also highlighted the potential for continued rate volatility in the face of imminent economic reports, the 2024 election, and the Federal Reserve's interest rate decision.
The PMMS® focuses on conventional, conforming, fully amortizing home purchase loans for borrowers with strong credit profiles and at least 20 percent down payments.
Freddie Mac, which has been operating since 1970, aims to foster a stable and affordable housing market. The organization plays a critical role in the American housing finance system by ensuring a constant flow of funds to mortgage lenders.
This week's mortgage rate figures are based on a survey of lenders and provide an insight into the cost of borrowing for homebuyers and homeowners looking to refinance. The information is based on a press release statement from Freddie Mac.
In other recent news, Freddie Mac reported a loss in the third quarter of 2024, falling short of analyst estimates. Despite this, the company's revenue significantly surpassed expectations, coming in at $5.84 billion, a figure that exceeded the analyst estimate of $3.61 billion by a sizable margin. This strong performance suggests that Freddie Mac's core business activities remained robust during the quarter, despite the challenges faced in a volatile economic environment. The company posted a loss of -$0.02 per share for the third quarter, a substantial decline from the same period last year, and missed the analyst consensus estimate of $0.90 earnings per share. These are recent developments that highlight the company's financial performance in the face of economic volatility.
InvestingPro Insights
As Freddie Mac (FMCC (OTC:FMCC)) navigates the volatile mortgage rate environment, InvestingPro data offers additional context to the company's financial position. Despite the challenges in the housing market, Freddie Mac's revenue growth stands at an impressive 27.92% for the last twelve months as of Q2 2023, reaching $22.96 billion. This growth underscores the company's resilience in a fluctuating economic landscape.
InvestingPro Tips highlight that Freddie Mac is a prominent player in the Financial Services industry, which aligns with its crucial role in the American housing finance system. The company's stock price movements have been quite volatile, reflecting the uncertain nature of the current mortgage market as described in the article.
Interestingly, while Freddie Mac has not been profitable over the last twelve months, analysts predict the company will be profitable this year. This optimism could be tied to the organization's ability to adapt to changing market conditions and its fundamental importance in ensuring a constant flow of funds to mortgage lenders.
For investors seeking a deeper understanding of Freddie Mac's financial health and market position, InvestingPro offers 8 additional tips, providing a more comprehensive analysis of the company's prospects in this dynamic mortgage rate environment.
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