Rates on 30-year fixed rate U.S. mortgage loans fell last week to their lowest point since March of 2004, a more than four and a half year low, according to data from mortgage company Freddie Mac Thursday.
“Following the release of the November employment report, which showed the largest monthly decline in jobs since December 1974, bond yields fell slightly this week allowing fixed-rate mortgage rates room to ease back a little further,” said Frank Nothaft, Freddie Mac vice president and chief economist.
The 30-year fixed rate mortgage carried an average rate of 5.47 percent, excluding points, during the week ended December 11, a drop from 5.53 percent the previous week. At the same time last year, the average rate was 6.11 percent.
Rates on 15-year fixed rate loans also fell, declining to 5.20 percent from 5.33 percent the previous week. One year ago, the average rate on these loans was 5.78 percent. The last time the 15-year mortgage rate was that low was at the beginning of the year, during the week of February 7, 2008, when the average was 5.15 percent.
One-year Treasury-indexed adjustable rate mortgages had an average interest rate of 5.09 percent, an increase from 5.02 percent one week earlier. During the same week of 2007, the average one-year ARM rate was much higher at 5.50 percent.
Things in the mortgage arena remain unstable, leaving the future of interest rates equally volatile, according to Freddie Mac.
“The housing market still hangs in the balance, however,” commented Nothaft. “On a year-over-year basis, after rising in both August and September, pending existing home sales fell 1.0 percent in October, based on figures from the National Association of Realtors®. Meanwhile, conventional mortgage applications for home purchases over the week ending December 5th were up 2.0 percent from four weeks prior, but were still 51 percent below the same period last year, according to the Mortgage Bankers Association.”
