Fixed Rate Mortgages Hit Record Low of 4.01 Percent
Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), coming on the heels of the Federal Reserve's recent announcements as the conventional 30-year fixed-rate mortgage (FRM) averaged an all-time record low at 4.01 percent, with an average 0.7 point for the week ending Sept. 29, 2011, down from the previous week when it averaged 4.09 percent. Last year at this time, the 30-year FRM averaged 4.32 percent. The 15-year FRM also averaged an all-time record low of 3.28 percent for the week, with an average 0.7 point, down from last week when it averaged 3.29 percent. A year ago at this time, the 15-year FRM averaged 3.75 percent. "Fixed mortgage rates fell to all-time record lows this week following the Federal Reserve's announcement of its Maturity Extension Program and additional purchases of mortgage-backed securities," said Frank Nothaft, vice president and chief economist for Freddie Mac. "Interest rates for ARMs, however, were nearly unchanged as the Federal Reserve plans to sell $400 billion in short-term Treasury securities, which serve as benchmarks for many ARMs." The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.02 percent this week, with an average 0.6 point, matching last week when it also averaged 3.02 percent. A year ago, the five-year ARM averaged 3.52 percent. The one-year Treasury-indexed ARM averaged 2.83 percent this week with an average 0.6 point, up from last week when it averaged 2.82 percent. At this time last year, the one-year ARM averaged 3.48 percent. "Meanwhile, the spring and summer home-buying season gave a boost to a number of house price indexes," said Nothaft. "The Federal Housing Finance Agency reported that its National index (not seasonally adjusted) rose for the fourth consecutive month in July. Similarly, the S&P/Case-Shiller 20-City composite index, which has a broader scope of properties, rose 0.9 percent between June and July with 17 of the cities experiencing positive monthly growth. Finally, CoreLogic reported that its index, excluding distressed sales, increased at a 1.7 percent monthly rate for the same month."