""Freddie Mac"":http://www.freddiemac.com released the results of its ""Primary Mortgage Market Survey"":http://www.freddiemac.com/pmms/release.html (PMMS) on Thursday, showing that mortgage rates dropped again this week, hitting yet another record-breaking low for all loan products in the GSE's study.
Frank Nothaft, Freddie Mac's VP and chief economist, noted that mortgage rates followed other interest rates lower this week after reports of slower economic growth emerged. ""The final estimate of economic growth in the fourth quarter was revised lower and personal incomes fell 0.2 percent in February, below the market consensus,"" Nothaft explained.
According to Freddie Mac's survey, the 30-year fixed-rate mortgage (FRM) averaged 4.78 percent (avg. 0.7 point) for the week ending April 2, 2009. Last week the 30-year FRM averaged 4.85 percent, and last year at this time, it was 5.88 percent. The 30-year FRM has not been lower in the life of Freddie Mac’s weekly survey, which dates back to 1971 for the 30-year FRM.
The 15-year FRM this week averaged 4.52 percent (avg. 0.7 point), down from last week when it averaged 4.58 percent. A year ago at this time, the 15-year FRM was 5.42 percent. The 15-year FRM was also the lowest its been in the life of Freddie Mac’s survey, going back to 1991 for the 15-year FRM.
Freddie Mac reported that five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.92 percent this week (avg. 0.7 point). The 5-year ARM dropped slightly from last week when it was 4.96 percent, but it also hit its lowest mark ever, dating back to 2005 in Freddie Mac's survey. A year ago, the 5-year ARM averaged 5.59 percent.
Rates for one-year Treasury-indexed ARMs came in at an average 4.75 percent this week (avg. 0.6 point), down from last week's average of 4.85 percent. At this time last year, the 1-year ARM averaged 5.19 percent. According to Freddie Mac, the 1-year ARM has not been lower since the week ending September 29, 2005, when it averaged 4.68 percent.
According to Nothaft, potential home buyers are beginning to take advantage of these historically low mortgage rates and falling home prices, as evidenced by the National Association of Realtors' recent report that ""pending existing home sales"":http://www.realtor.org/press_room/news_releases/2009/04/phs_gainxLID=RONav0021 rose 2.1 percent in February, the second increase in three months. Serving as a spur to sales, Nothaft also pointed out that housing affordability reached an all-time high in February 2009.