U.S. Mortgage Rates End Year With an Increase to 3.11%

2/2 © Bloomberg. A 2/2

(Bloomberg) — Mortgage rates in the U.S. rose, matching where they were at the beginning of December.

The average for a 30-year loan was 3.11%, up from 3.05% last week, Freddie Mac (OTC:FMCC) said in a statement Thursday.

Rates tracked a gain in yields for 10-year Treasuries, which climbed above 1.5% for only the second time this month, despite the recent jump in Covid-19 cases. Economic data suggest that the recovery “remains on firm ground,” with low interest rates and high asset valuations continuing to drive consumer spending, Sam Khater, Freddie Mac’s chief economist, said in the statement.

Borrowing costs are still close to the historic lows that have stoked demand for a tight supply of homes throughout the pandemic, pushing buyers into bidding wars. A year ago, the 30-year average was 2.67%. It fell to a record low of 2.65% one week later.

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