Low Mortgage Rates Continue, Providing ‘Boost’ for Housing

The Wall Street Journal

26 April  2013

Mortgage rates in the U.S. fell during the past week, with the average 15-year fixed rate and the five-year adjustable-rate both hitting record lows, according to mortgage-finance company Freddie Mac.

Mortgage rates have remained near record lows in recent months. The latest week marked the fourth in a row that fixed mortgage rates have declined. “The housing market is getting a boost with mortgage rates hovering at or near record lows,” said Frank Nothaft, Freddie Mac’s chief economist.

Recent data showed that first-quarter existing home sales reached the highest level since the fourth quarter of 2009, while new home sales were the strongest since the third quarter of 2008, Mr. Nothaft said.

For the week ended Thursday, the 30-year fixed-rate mortgage averaged 3.4%, compared with 3.41% the previous week and 3.88% a year earlier. Rates on 15-year fixed-rate mortgages averaged 2.61%, versus 2.64% a week earlier and 3.12% a year ago. The previous low for the 15-year rate was 2.63%, which was hit during the week of Nov. 21 last year.

Five-year Treasury-indexed hybrid adjustable-rate mortgages, or ARMs, averaged 2.58%, compared with 2.6% the previous week and the 2.85% rate set a year earlier. One-year Treasury-indexed ARM rates averaged 2.62%, compared with 2.63% the prior week and 2.74% set a year ago.