MORTGAGE RATES INCH UP TO 6.3% HOME SALES UNHURT.

Byline: Gregory J. Wilcox Staff Writer

Mortgage rates inched up this week to average 6.30 percent and are expected to go higher, further cooling the refinance market, but home sales are expected to remain strong, economists and analysts said Thursday.

For the week ending today, rates rose 0.02 percentage point from last week, reported Freddie Mac, the big mortgage company. A year ago rates on a 30-year loan averaged 5.21 percent.

Last June rates eventually hit a 45-year low, then began trending up.

The low so far this year was 5.38 percent for the week that ended March 18.

``We've begun a very gradual uptrend in interest rates in general,'' said Frank Nothaft, Freddie Mac's chief economist.

The move up comes in anticipation of the likelihood the Federal Reserve Board will boost a key interest rate when it meets next week.

``The market has begun to fully expect that,'' he said.

This week the rate for a 15-year, fixed-rate mortgage averaged 5.67 percent, up from 5.63 percent last week. The one-year adjustable rate increased to 4.14 percent this week, up from last week's average of 3.98 percent.

While the purchase market is expected to remain strong, refinance activity is well off the record levels of a year ago.

Earlier in the week the Mortgage Bankers Association reported that its Refinance Index is down 86.3 percent from the record high of 9,977.8 set exactly one year ago.

Doug Duncan, the group's chief economist, said refinancing has been in decline since last July.

He, too, expects the Fed to gradually raise rates.

``When interest rates rise, will house prices fall? And the answer is no. Sales fall,'' he said.

Rates probably will bounce between 6 1/2 and 7 percent this year, still low by historical standards. For example, for part of 1981, the rate on a 30-year mortgage peaked at 18 percent, Duncan said.

Nima Nattagh, analyst at FNC, which supplies real estate market data to the mortgage banking industry, believes that the home purchase market won't suffer much from higher rates.

``It obviously depends on how much they are going to go up. If they go up by 1 to 1 1/2 percent, I don't think it's going to have an impact on the purchase market,'' he said.

Gregory J. Wilcox, [phone]

greg.wilcox(at)dailynews.com