Mortgage rates climb to 5.29 percent

A year ago, the 30-year fixed-rate mortgage averaged 6.52 percent



Rates on 30-year mortgages rose this week, remaining above 5 percent after reaching a record low earlier this year, Freddie Mac said Thursday.

The average rate on a 30-year fixed-rate mortgage was 5.29 percent this week, up from 5.22 percent last week, Freddie Mac said. Last year at this time, the 30-year fixed-rate mortgage averaged 6.52 percent.

Rates on 30-year mortgages dropped to a record low of 4.78 percent earlier this year, but have been above 5 percent since June.

Though the troubled U.S. housing market is beginning to stabilize, higher rates could slow down any recovery, since prospective buyers would be able to borrow less money and might decide to hold off on their purchases.

Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.

The average rate on a 15-year fixed-rate mortgage was 4.68 percent, an increase from 4.63 percent last week, Freddie Mac said.

Rates on five-year, adjustable-rate mortgages averaged 4.75 percent, up from 4.73 percent last week. Rates on one-year, adjustable-rate mortgages dropped to 4.72 percent from 4.78 percent.

The rates do not include add-on fees known as points. The nationwide fee averaged 0.7 point for 30-year and 15-year fixed-rate mortgages, 0.6 point for five-year adjustable-rate mortgages, and 0.4 point for one-year adjustable-rate mortgages.

Home sales grew in second quarter in 39 states

But home prices across the nation are still soft versus a year ago

WASHINGTON - U.S. home sales grew in the second quarter in 39 states, another sign that the ailing housing market is finally coming to life.

Total quarterly sales rose 3.8 percent to a seasonally adjusted annual rate of 4.76 million, from 4.58 million in the first quarter, but were still about 3 percent below a year ago, the National Association of Realtors said Wednesday.

Sales posted quarterly gains of 20 percent or more in Idaho, Hawaii, New York, Wisconsin and Nebraska. But Alaska, Wyoming, California, Colorado and Michigan dropped by at least 6 percent.

Prices, however, were still down from a year ago in 129 out of 155 metropolitan areas the group tracks. The median sales price in the quarter was $174,100, almost 16 percent below a year ago.

The biggest drop, of nearly 53 percent, was in Fort Myers, Fla. Prices also fell 35 percent or more in Phoenix, Riverside, Calif. and Las Vegas. The biggest price gain, of nearly 31 percent, was in Davenport, Iowa, followed by Cumberland, Md., at nearly 22 percent.

Nationwide, foreclosures and distressed sales made up more than a third of all sales in the second quarter.

Many economists now say that the worst of the housing recession is over, though foreclosures are expected to rise over the next year.

Lawrence Yun, the trade group's chief economist, called the sales increase "a hopeful sign for the economy."