Mortgage rates hit all-time low

Sub-3% rate possible as Freddie Mac sees pause in economic rebound

National /
Jul.July 02, 2020 01:29 PM
The 30-year fixed-rate mortgage averaged 3.07 percent for the week ending July 2 (iStock)

The 30-year fixed-rate mortgage averaged 3.07 percent for the week ending July 2 (iStock)

The downward slide in mortgage rates produced a new milestone this week, according to Freddie Mac’s latest primary mortgage market survey.

The 30-year fixed-rate mortgage averaged 3.07 percent for the week ending July 2, down 0.06 percentage points from the week before and down 0.68 points year-over-year. It is the lowest rate on record since the survey began in 1971.

“Mortgage rates continue to slowly drift downward with a distinct possibility that the average 30-year fixed-rate mortgage could dip below 3 percent later this year,” Freddie Mac chief economist Sam Khater said in a statement.

“On the economic front, incoming data suggest the rebound in economic activity has paused in the last couple of weeks with modest declines in consumer spending and a pullback in purchase activity,” he added.

The 15-year fixed-rate mortgage declined slightly to 2.56 percent, while the 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3 percent.

The 30-year and 15-year fixed-rate mortgages both had an average 0.8 point for the week, meaning consumers on average paid 0.8 percent of the loan amount in discount and origination fees.

Since the Federal Reserve slashed its benchmark interest rate to near zero in mid-March, the gap between the 10-year Treasury yield and the 30-year fixed-rate mortgage average has been historically large. Economists have attributed this to challenges facing the retail mortgage market, which are expected to fade in the coming months.

Falling rates have led to a boom in home loan applications in recent months, reaching an 11-year high in mid-June before falling off amid doubts about the economic recovery.


Related Articles

arrow_forward_ios
The tax break allows foreign visitors to reclaim a sales tax of 20 percent on items bought in the country for more than £30 (Getty; Unsplash)

UK tax break expiration could hurt struggling retailers

UK tax break expiration could hurt struggling retailers
(iStock)

Mortgage requests surge ahead of Thanksgiving

Mortgage requests surge ahead of Thanksgiving
Cineworld Group CEO Mooky Greidinger and Regal Cinema (Photo via Getty; Wikipedia)

Regal Cinemas scores financial rescue package

Regal Cinemas scores financial rescue package
(iStock)

What doom-and-gloom forecasts miss about the office market

What doom-and-gloom forecasts miss about the office market
Union Square Hospitality Group CEO Danny Meyer and the Union Square Cafe (Photos via Getty; Wikipedia Commons)

Danny Meyer’s Union Square Hospitality halts indoor, outdoor dining

Danny Meyer’s Union Square Hospitality halts indoor, outdoor dining
A recent study that found 1 in 10 Black homeowners returned to renting between 1984 and 2017 (iStock)

Black homeowners twice as likely to lose homes and return to renting: Report

Black homeowners twice as likely to lose homes and return to renting: Report
(iStock)

Ski resorts gear up for tough season in the shadow of pandemic

Ski resorts gear up for tough season in the shadow of pandemic
Palermo, Italy (iStock)

For some employees, WFH now includes a view of the Mediterranean

For some employees, WFH now includes a view of the Mediterranean
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...