Interest rates climb again

Freddie Mac says interest rates increased again last week, resuming their slow ascent after dipping slightly during the previous week.

According to the mortgage giant's latest weekly survey, the average interest rate for a 30-year fixed-rate home loan during the week ending December 30 was 4.86 percent, up from 4.81 percent the week before.

While rates are still low historically, they are up significantly from their recent low of 4.17 percent seven weeks earlier. But at the same time, the housing market has shown signs of recovery, despite slipping home prices.

"Recent news on housing markets has been mixed," said Frank Nothaft, vice president and chief economist at Freddie Mac. "Home sales continue to recover in the months following the expiration of the homebuyer tax credit, however, with sales of new and existing homes up 5.5 percent and 5.6 percent, respectively, in November."

Despite the recent increases, the mortgage giant added that rates averaged less than 4.7 percent throughout 2010, the lowest average rate since 1995 - when the average home cost $22,000.

Countering the national trend, the prices of Houston homes have remained level in recent months. Data from the Houston Association of Realtors found that the median home price last month was $152,500, up 1.7 percent from a year ago.