Fixed mortgage rates started the year at or near their all-time record lows, according to market data published by Freddie Mac Thursday.
The GSE reports the interest rate on a 30-year fixed mortgage averaged 3.91 percent (0.8 point) for the week ending January 5, 2012. That’s down from 3.95 percent the previous week and matches the record low set just two weeks earlier.
This marks the fifth consecutive week the 30-year rate has come in below the 4.00 percent mark. To put things into perspective, last year at this time, it was averaging 4.77 percent.
The 15-year fixed-rate averaged 3.23 percent (0.8 point) in Freddie Mac’s survey this week, down from 3.24 percent the week prior.
The current average rate on a home loan with a 15-year fixed term is just two basis points above its all-time low of 3.21 percent, which was hit in two weeks during the month of December. A year ago, the average 15-year rate was at 4.13 percent.
Frank Nothaft, Freddie Mac’s chief economist, attributed the declines seen among fixed rates to recent data reports which indicate the housing market and manufacturing industry are showing signs of improvement.
“Pending existing home sales in November jumped 7.3 percent, nearly five times greater than the market consensus forecast, to its strongest pace since April 2010,” Nothaft noted.
“In addition,” he said, “construction spending rose 1.2 percent in November, supported by the residential sector which exhibited its fourth consecutive monthly increase. Similarly, manufacturing expanded in December at the fastest pace in six months.”
Freddie Mac’s report shows the 5-year adjustable-rate mortgage (ARM) came in at 2.86 percent (0.7 point) this week, down from 2.88 percent. This time last year, the 5-year ARM was averaging 3.75 percent.
The GSE’s survey puts the 1-year ARM at 2.80 percent (0.6 point). It was the only loan product included in the GSE’s study to head higher, up from 2.78 percent last week. Flip the calendar back 12 months, and the 1-year ARM was averaging 3.24 percent.
This article is from DSNews.com: “Thirty-Year Fixed-Rate Matches All-Time Low.”