Florida Mortgage Rates Rise After Economic Reports Rekindle Inflation Fears

Rates on 30-year Florida mortgages rose this week to their highest level since mid-November after better-than-expected employment prospects have rejuvenated inflation concerned in U.S. financial markets, which then trickles down to many state businesses and to consumers.

A survey of the state’s lenders concluded that 30-year, fixed-rate Florida mortgage loan rates averaged 6.21 percent this week, up 0.03 percent from last week’s average of 6.18 percent.

This week’s average represents the highest level since November 16, when 30-year, fixed Florida mortgage rates stood at 6.24 percent.

Analysts say financial markets are reacting to stronger outlooks for the country’s and Florida’s economy, after 167,000 jobs were created in December, the best showing in three months.

“The gain in employment in December exceeded the consensus forecast and helped ease fears about the state of the economy,” said Frank Nothaft, Freddie Mac’s chief economist.

“But stronger employment and higher wages put upward pressure on inflation, which in turn, translates into higher mortgage rates.”

Nothaft, however, said he did not feel home loan rates would rise very far this year, predicting that 30-year rates would not top 6.5 percent - great news for Floridians looking to purchase a home.

The survey revealed that other types of Florida mortgage loans saw similarly slight increases this week in regards to rates.

One-year ARMs remained stable for the week.

Rates remain around where they were a year ago, even as they climed to nearly 7 percent last June. A year ago, Florida home mortgage rates on 30-year mortgages stood at 6.15 percent while 15-year fixed-rate mortgages were at 5.71 percent.

Rates on 15-year, fixed-rate mortgages, a popular choice for Florida mortgage refinancing, edged up to 5.96 percent, having finished the previous week at 5.94 percent.