U.S. mortgage rates mark new '15 high
WASHINGTON -- Average long-term U.S. mortgage rates rose this week to their highest level so far this year.
Mortgage giant Freddie Mac said Thursday that the average rate on a 30-year fixed-rate mortgage increased to 3.87 percent from 3.84 percent a week earlier. The rate on 15-year fixed-rate mortgages rose to 3.11 percent from 3.05 percent.
Rates have risen in recent weeks with signs of improvement in the economy.
Despite their recent climb, mortgage rates remain low by historic standards. A year ago, the average 30-year rate was 4.12 percent, and the 15-year was 3.21 percent.
To calculate average mortgage rates, Freddie Mac, the Federal Home Loan Mortgage Corp., surveys lenders across the country at the beginning of each week. The average doesn't include extra fees, known as points, that most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage fell to 0.6 point this week from 0.7 point last week. The fee for a 15-year loan slipped to 0.5 point from 0.6 point.
-- The Associated Press
April pending home sales most in 9 years
WASHINGTON -- Americans signed contracts to buy homes in April at the fastest pace in nearly nine years, evidence that steady job growth is strengthening the real estate market.
The National Association of Realtors said Thursday that its seasonally adjusted, pending home sales index climbed 3.4 percent to 112.4 last month. It's the fourth-consecutive monthly gain. The index now stands at its highest level since May 2006.
"The confidence has returned to housing, not only as shelter but as a good long-term investment," said Ron Peltier, chief executive of Berkshire Hathaway's real estate affiliate, HomeServices of America.
The upswing comes after a year of strong hiring, which has heightened demand to buy houses. Increased sales should help bolster the economy, but the surge could destabilize the housing market, Peltier cautioned. Inventories remain low, causing home values to rise faster than wage growth.
Signed contracts are a barometer of future purchases. A one- to two-month lag usually exists between a contract and a completed sale.
Pending sales increased in the Northeast, Midwest and South, while barely edging upward in the West.
-- The Associated Press
FCC proposes Internet access for poor
NEW YORK -- The head of the Federal Communications Commission is proposing that the government agency expand a phone subsidy program for the poor to include Internet access.
The FCC chairman, Tom Wheeler, has called broadband a critical service for modern life. But many low-income people don't have access.
According to a Pew Research Center report from 2013, 70 percent of U.S. adults have a high-speed Internet connection at home. Only 54 percent of households earnings less than $30,000 a year do.
The FCC says low-income Americans are more likely to rely on smartphones for Internet access. According to the Pew report, 67 percent of households that make less than $30,000 a year have home broadband or a smartphone.
The program, called Lifeline, was started in 1985 and expanded to include wireless phones in 2005. In 2014, it served 12 million households and cost $1.7 billion, paid for by surcharges on U.S. customers' telephone bills.
The FCC's proposal calls for extending Lifeline's $9.25 monthly credit to give low-income households a choice of Internet or phone service.
-- The Associated Press
W. Virginia coal output expected to fall
CHARLESTON, W.Va. -- West Virginia University researchers predict that state coal production will drop 39 percent compared with the industry's latest high point in 2008.
The university's Bureau of Business and Economic Research released a report Thursday assessing coal production outlook over the next 20 years.
The forecast said production will fall from 115 million short tons in 2014, to 104 million short tons this year, to 98 million short tons in 2016.
Despite a moderate rebound from 2017 to 2020, production would drop to less than 96 million short tons in 2035. West Virginia produced 158 million short tons in 2008.
A 29 percent drop would hit the already struggling southern coalfields by 2035. Northern coalfields' production would only drop somewhat.
The report attributes coal's continued fall to various economic, environmental and regulatory factors.
-- The Associated Press
Business on 05/29/2015