Fixed-rate mortgages hit new lows
30-year fixed-rate mortgages are averaging record-breaking lows, according to Freddie Mac’s Primary Mortgage Market Survey.
According to the survey, 30-year fixed-rate mortgages averaged 3.49 percent, more than a full percentage point lower than a year ago when it averaged 4.55 percent. Meanwhile, the 15-year fixed-mortgage also set another record at 2.80 percent.
Record low mortgage rates fuel housing demands and lead to a pickup in housing starts, home sales, and even housing prices in many markets, according to the report
“Market concerns over the strength of the economic recovery brought long-term treasury yields to new lows this week allowing fixed mortgage rates to reach record levels,” said Frank Nothaft, vice president and chief economist at Freddie Mac.
Nothaft reported the largest monthly decline since September 2011. “Existing home sales fell to 4.36 million homes (annualized) in June and represented the slowest pace since October 2011,” he added. “Similarly, new home sales fell in June to their lowest level since January of this year.”
Nothaft pointed to recent increases in new home construction and improving homebuilder confidence as signs of an improving housing market.
Findings from the survey include:
- 30-year fixed-rate mortgage (FRM) averaged 3.49 percent with an average 0.7 point for the week ending July 26, 2012, down from last week when it averaged 3.53 percent. Last year at this time, the 30-year FRM averaged 4.55 percent.
- 15-year FRM this week averaged 2.80 percent with an average 0.7 point, down from last week when it averaged 2.83 percent. A year ago at this time, the 15-year FRM averaged 3.66 percent.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.74 percent this week with an average 0.6 point, up from last week when it averaged 2.69 percent. A year ago, the 5-year ARM averaged 3.25 percent.
- 1-year Treasury-indexed ARM averaged 2.71 percent this week with an average 0.5 point, up from last week when it averaged 2.69 percent. At this time last year, the 1-year ARM averaged 2.95 percent.
Full details of the survey results can be found on the Freddie Mac website.
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