Mortgage rates hit a new record low for the week at 4.54%, according to Freddie Mac down from 4.56% last week as lenders try to attract more home buyers back to the market. The rate for a 30-year fixed rate mortgage was 5.25% a year ago. Rates have been tracked by Freddie Mac since 1971.
“For the sixth week in a row, interest rates on fixed-rate mortgages eased to all-time record lows during a week of mixed housing data reports,” said Frank Nothaft, Freddie Mac chief economist. “Existing home sales in June slowed to an annualized pace of 4.37 million units, the fewest since March,” said Nothaft. “Moreover, although new home sales jumped by almost 24% to 330,000 dwellings, it represented the second slowest rate since 1963.”
Rates haven’t been as low as they are in nearly 50 years, but it still hasn’t been enough to attract home buyers back to the market in a big way. Weak consumer confidence over the housing market tied to declining home values and high unemployment are troubling most areas of the country after the expiration of the federal tax credit for home buyers.
The average rate for a 15-year fixed rate mortgage was 4% down from last week’s average of 4.03%. The average is also a new low for the survey. Freddie said the five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.76%. It averaged 3.79% last week. A year ago the 5-year ARM averaged 4.75%.
The one-year Treasury indexed ARM averaged 3.64% down from last week when it averaged 3.7%.