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Fri Feb 03, 2012
Interest rates for 30-year and 15-year fixed-rate mortgages have fallen for five consecutive weeks, and this week both set a new all-time record low, “Freddie Mac reported Thursday”:http://www.freddiemac.com.
It’s been a good year for borrowers when it comes to the costs associated with purchasing or refinancing a home. According to Freddie Mac’s chief economist, Frank Nothaft, interest rates on 30-year and 15-year mortgages through all of 2009 have averaged a full percentage point below their respective average in 2008.
Freddie Mac’s latest market survey shows that for the week ending December 3, rates for 30-year fixed-rate mortgages (FRM) averaged 4.71 percent (0.7 point). That’s down from last week’s average of 4.78 percent, and significantly lower than the 5.53 percent rate of a year ago.
Freddie Mac said the 30-year rate has never been as low as it is now, since the GSE began its weekly survey in 1971.
The 15-year FRM this week came in at 4.27 percent (0.6 point), down from last week when it averaged 4.29 percent. A year ago at this time, the 15-year FRM was 5.77 percent. The 15-year FRM is currently the lowest it’s been since Freddie Mac started tracking it in 1991, and breaks the record low set last week.
Based on the GSE’s study, rates for 5-year adjustable-rate mortgages (ARM) averaged 4.19 percent (0.6 point) this week. The average for one-year ARMs was 4.25 percent (0.6 point).
“Low mortgage rates and the cumulative decline in house prices have contributed to an extremely affordable housing market and helped spur home sales this year,” Nothaft said.
He pointed to statistics from the Census Bureau and National Association of Realtors (NAR), which showed that total new and existing home sales in October were 36 percent higher than their January low.
NAR also recently reported that pending existing-home sales rose for the ninth straight month in October, representing the longest consecutive gain since the series began in 2001. Seven of those months were the most affordable on record dating back to 1971, Nothaft noted.
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