Mortgage rates rose for a second week, buoyed by a selloff in the bond market, even as housing faces a grim reminder of unfinished work in the mortgage market.

The 30-year fixed-rate mortgage averaged 4.54% in the Sept. 5 week, according to Freddie Mac’s weekly survey, up two basis points. The 15-year fixed-rate mortgage averaged 3.99%, up from 3.97%. The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.93%, up eight basis points.

Those rates don’t include fees associated with obtaining mortgage loans.

Mortgage rates follow the path of the benchmark U.S. 10-year Treasury note. Bond prices have ticked down, pushing yields up, as the rosy economic data of the past week made safe-haven assets less attractive.

Thursday is an auspicious anniversary for Freddie and its counterpart, Fannie Mae. It’s 10 years to the day since the United States government hustled the two companies, on the brink of a liquidity crisis, into state control.

That arrangement, known as conservatorship, was meant to be temporary, until Congress found a permanent, stable path forward. But that hasn’t happened. Still, many observers of the two enterprises have argued that over the past decade, they’ve reformed themselves into the staid, dependable guarantors that the American mortgage market has long needed, with no support from Washington.

Fannie and Freddie help the housing market by buying mortgages from banks and other lenders, enabling those financial institutions to free up their balance sheets for more lending. The enterprises shed their own risk by, among other things, selling securities to investors. More certainty — and more capital — would help the two companies, and might in turn bolster the housing market, which is flagging.

In a release, Sam Khater, Freddie’s chief economist, noted that interest rate rises, even by just a few basis points, erode affordability in a market that’s already stretched thin.

“This weakening in affordability is hindering many interested buyers this fall, even as the robust economy brings them into the market,” Khater said. “The good news is that purchase mortgage applications have recently rebounded to above year ago levels.”

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By: Andrea Riquier,

Those rates don’t include fees associated with obtaining mortgage loans.