Weekly rates nearly flat according to Freddie Mac PMMS

Weekly rates nearly flat according to Freddie Mac PMMS

October 29, 2009
A shrinking inventory is being blamed for the stagnation in the latest Redfin Housing Demand Index, which barely inched up from 126 in July to 127 in August.

Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 5.03 percent with an average 0.7 point for the week ending Oct. 29, 2009, up from last week when it averaged five percent. Last year at this time, the 30-year FRM averaged 6.46 percent. The 15-year FRM this week averaged 4.46 percent with an average 0.6 point, up from last week when it averaged 4.43 percent. A year ago at this time, the 15-year FRM averaged 6.19 percent.
The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.42 percent this week, with an average 0.6 point, up from last week when it averaged 4.40 percent. A year ago, the five-year ARM averaged 6.36 percent. The one-year Treasury-indexed ARM averaged 4.57 percent this week with an average 0.6 point, up from last week when it averaged 4.54 percent. At this time last year, the one-year ARM averaged 5.38 percent. Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.
“Interest rates for 30-year fixed mortgages have averaged just below five percent this year, which is the lowest 10-month average since the survey began in 1971,” said Frank Nothaft, Freddie Mac vice president and chief economist. “As a result, refinance activity has accounted for almost seven out of 10 mortgage applications on average this year, according to Freddie Mac’s survey. Economic data releases this week offered mixed signals as to the current state of the housing market. For example, total existing home sales jumped 9.4 percent to an annualized rate of 5.57 million homes in September, the strongest pace since July 2007, according to the National Association of Realtors (NAR). However, new home sales unexpectedly fell 3.6 percent to 402,000 houses, the weakest since June of this year, based on figures from the Department of Commerce. Nonetheless, stronger housing demand has lowered the inventory of unsold existing homes in September to the lowest since January of this year and for new homes the lowest since November 1982, which should help stabilize falling house prices.” 
For more information, visit www.freddiemac.com.

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