Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), showing mortgage rates, both fixed-rate mortgages (FRMs) and adjustable-rate mortgages (ARMs), hitting all-time record lows amid market and employment concerns and economic uncertainty. The previous record lows for fixed mortgage rates, and the one-year ARM, were set the week of Aug. 18, 2011.
The 30-year FRM averaged 4.12 percent with an average 0.7 point for the week ending Sept. 8, 2011, down from last week when the 30-year FRM averaged 4.22 percent. Last year at this time, the 30-year FRM averaged 4.35 percent. The 15-year FRM this week averaged 3.33 percent with an average 0.6 point, down from last week when it averaged 3.39 percent. A year ago at this time, the 15-year FRM averaged 3.83 percent.
"Market concerns over Eurozone sovereign debt default and a weak U.S. employment report for August placed downward pressure on Treasury bond yields and allowed fixed mortgage rates to hit new lows this week," said Frank Nothaft, vice president and chief economist for Freddie Mac. "On net, the economy added no new jobs last month and was the weakest reading since September 2010. Meanwhile, the unemployment rate remained at 9.1 percent, marking its 31st consecutive month of being above eight percent, the longest such stretch in 70 years."
The five-year Treasury-indexed hybrid ARM averaged 2.96 percent this week, with an average 0.6 point, the same as last week when it averaged 2.96 percent. A year ago, the five-year ARM averaged 3.56 percent. The one-year Treasury-indexed ARM averaged 2.84 percent this week with an average 0.6 point, down from last week when it averaged 2.89 percent. At this time last year, the one-year ARM averaged 3.46 percent.
"The Federal Reserve (Fed) painted a bleaker picture as well in its Sept. 7 regional economic review," said Nothaft. "Seven of its 12 districts reported more subdued views of business conditions. Many of the Fed's manufacturing contacts downgraded or became more cautious about their near-term outlooks due to increased economic uncertainty."