Metro Atlanta mortgage rates up this week, though still historically low

It’s costing you more this week than it did last week to finance that home you want to buy, according to Bankrate.com.

Metro Atlanta’s seesawing rates rose to an average 4.58 percent on a 30-year fixed mortgage this week, up from 4.54 percent last week based on a survey of the local market’s largest banks and thrifts, Bankrate reported Thursday.

David Ellis, executive vice president of the Greater Atlanta Homebuilders Association, said the rising rates, which are still at historically low levels, are having a dual effect in the marketplace.

“For some on the borderline, they may not be able to afford the home they want and have to settle for a little less,” Ellis said. “For some it’s a wake-up call that may push them into the market” for a new home.

Polyana da Costa, a senior mortgage analyst at Bankrate, said lenders are seeing a spike in business as rates rise.

“The chances of rates going up is a lot higher than the chances of rates going down,” da Costa said. “I don’t think rates will go back to the record lows that we saw even three months ago, when the 30-year fixed was about 3.5 percent.”

While the average 30-year rate is down from a month ago, when it was 4.83 percent, it is up noticeably from 3.76 percent at the start of the year, according to Bankrate's data. The metro rate, however, was much lower than the national average rate of 4.72 percent on a 30-year loan. A separate national report by Freddie Mac on Thursday also showed national mortgage rates trending higher, although Freddie Mac and Bankrate used different variables to arrive at their rates.

Bankrate’s survey assumed a loan amount of $165,000, for which the monthly payment was estimated at $843.89 based on this week’s metro Atlanta average rate. The figure, however, doesn’t include insurance and taxes. The payment was $3.94 more than it was last week.

This week’s survey reported an average total of 0.6 discount and origination points, which are prepaid expenses. One point is equal to 1 percent of the loan amount.

Not only are metro homebuyers being hit with higher mortgage rates, home prices and closing costs are also on the rise in a market where there is a shortage of homes on the market. The squeeze is also putting pressure on apartment rents.

The competition for housing may intensify in the months ahead. The nation’s largest mover, United Van Lines, reported Thursday that Atlanta saw 10 percent more inbound moves to the city than moves outward. Atlanta ranked 10th on United’s list of cities with more people moving into a metropolitan region than out.

Other metro Atlanta mortgage loan rates also were higher this week. Bankrate reported the average 15-year fixed rate in metro Atlanta this week was 3.55 percent, up from 3.54 percent.