Even more record lows for mortgage rates as housing data looks bleak

New York /
Aug.August 26, 2010 01:30 PM

Mortgage rates fell to new record lows yet again this week as gloomy reports about U.S home sales shook the markets, according to data from Freddie Mac. For the week that ended today, the popular 30-year fixed-rate mortgage averaged 4.36 percent, its lowest since the government-sponsored mortgage giant began tracking it in 1971. Last year at this time, the 30-year mortgage averaged 5.14 percent. The 15-year mortgage experienced a similar decline, to 3.86 percent, down from 4.58 percent during the same week last year. Freddie Mac has been tracking the 15-year mortgage since 1991, and its interest rate has never before been this low. Meanwhile, both the 5-year and 1-year Treasury-indexed adjustable-rate mortgage tied their record low interest rates of 3.56 and 3.52 percent, respectively. Amy Crews Cutts, deputy chief economist for Freddie Mac, cited the 27 percent drop in existing home sales in July and the simultaneous 12 percent dip in new home sales — to a new record low — as having “led to some market concerns that the housing market may slow the economic recovery. As a result, long-term bond yields fell to the lowest levels since January 2009, allowing fixed mortgage rates to ease to new record lows this week,” she said. TRD

 

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