Mortgage rates set new record lows
Fixed mortgage rates continue sliding
Mortgage rates continued their recent downward trend, dropping to new all-time record lows, Freddie Mac said this morning.
According to Freddie Mac’s Primary Mortgage Market Survey for the week ending September 27, 2012, three of four mortgage products surveyed reached new historical record low averages.
Average rates for 30-year fixed-rate mortgages dropped sharply to 3.40 percent from 3.49 percent the previous week, while 15-year fixed mortgages dropped to 2.73 percent from 2.77 percent. Both averages are new all-time record lows.
One year ago at this time, 30-year fixed mortgages averaged 4.01 percent and 15-year fixed mortgages averaged 3.28 percent.
ARMs see averages drop, too
Adjustable-rate mortgages (ARMs) also saw average interest rate declines on a weekly basis.
Average rates for 5-year ARMs dropped from 2.76 percent to 2.71 percent week-over-week, while 1-year ARMs dropped from 2.61 percent to 2.60 percent on a weekly basis.
The average rate for 1-year ARMs was a new all-time record low, Freddie Mac said.
One year ago at this time, 5-year ARMs averaged 3.02 percent and 1-year ARMs averaged 2.83 percent.
“Fixed mortgage rates continued to decline this week, largely due to the Federal Reserve’s purchases of mortgage securities, and should support an already improving housing market,” Frank Nothaft, vice president and chief economist at Freddie Mac, said in a statement.
Nothaft added evidence of an improving market:
“For instance, the S&P/Case-Shiller® 20-city home price index rose 1.2 percent over the 12 months ending in July, reflecting the largest annual increase since August 2010,” he said. “Moreover, 16 of the cities saw positive growth, led by Phoenix’s 16.6 percent gain. Additionally, new home sales in July and August had the strongest two-month pace since March and April 2010.”