HIGHER INTEREST RATES MAY HANG AROUND FOR SOME TIME.

Byline: GREGORY J. WILCOX

Last week brought higher interest rates and they might hang around a while, too.

A survey released Thursday by Freddie Mac, the big mortgage company, showed that the average rate on a 30-year, fixed-rate loan rose to 5.79 percent, up from 5.52 percent the prior week and the highest since that benchmark hit 5.87 percent in the Jan. 8 report.

A day earlier the Mortgage Bankers Association had the 30-year rate at 5.75 percent for the week ending April 2.

Blame, or credit, a strengthening economy, especially a report earlier in the month that showed the economy had added 308,000 jobs in March.

When the economy improves, interest rates, both short term and long term, tend to rise.

Of course, sometimes the movement is an overaction to current events.

One expert, Keith T. Gumbinger, vice president at HSH Associates in Butler, N.J., the nation's biggest provider of mortgage information, is in this camp.

``Rates should not have gone down as far as they did in January and February. The economic news was not that dire,'' he said. ``There just weren't any jobs to talk about so rates probably went down more than warranted.''

Economically speaking, rates now look to be in their sweet spot.

``We're probably about right-priced right now for whatever the next phase of the economy is,'' Gumbinger said.

But that doesn't mean they are going to stay put, either, notes Jay Brinkmann, vice president of research and economics at the Washington, D.C.- based bankers group.

``It's going to be bouncing around with an upward trend. Kind of like a basketball bouncing up a flight of stairs,'' he said of the likely direction rates will take.

Or maybe bouncing down?

Notes:

--This uptick in rates will deal affordability a blow as the market moves into its prime buying season, which typically brings higher prices.

But the vast majority of buyers are still coming up with down payments of around 20 percent, said reports analyst John Karevoll at La Jolla-based DataQuick Information Systems.

Last month in Los Angeles County the average loan-to-value ration was 83.1 percent.

--New homes remain hot properties.

Newport Beach-based William Lyon Homes said orders and the backlog hit record levels during the first quarter.

In the first three months of the year, Lyon booked 1,092 orders, an annual increase of 44 percent. That's a record for any quarter. The company had a backlog - homes sold but not closed - of 1,755 units at the end of the month, up an annual 64 percent. That's a first-quarter record, the company said.

Gregory J. Wilcox, [phone]

greg.wilcox(at)dailynews.com