Fixed Rate Mortgages Plunge Even Further to 3.78 Percent

Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), showing the record lows for average fixed mortgage rates holding steady for the week, as the 30-year fixed-rate mortgage (FRM) averaged 3.78 percent with an average 0.8 point for the week ending May 24, 2012, down from last week when it averaged 3.79 percent. Last year at this time, the 30-year FRM averaged 4.60 percent. Also this week, the 15-year FRM this week averaged 3.04 percent with an average 0.7 point, unchanged from last week. A year ago at this time, the 15-year FRM averaged 3.78 percent. "Mortgage rates were virtually unchanged this week with fixed-rate loans remaining at record lows and helping to drive homebuyer affordability," said Frank Nothaft, vice president and chief economist for Freddie Mac. "The National Association of Realtors Housing Affordability Index reached an all-time record high in the first quarter of this year since records began in 1970. In April, existing home sales rose to the highest rate since January with an annualized rate of 4.62 million homes with purchases increasing in all four Census Regions." The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.83 percent this week, with an average 0.6 point, unchanged from last week. A year ago, the five-year ARM averaged 3.41 percent. Meanwhile, the one-year Treasury-indexed ARM averaged 2.75 percent this week with an average 0.4 point, down from last week when it averaged 2.78 percent. At this time last year, the one-year ARM averaged 3.11 percent. "Sales of new homes also rose last month, beating the market consensus forecast," said Nothaft. "In addition, the Federal Housing Finance Agency purchase-only house price index rose 0.4 between the first quarter of 2011 and 2012 and represented the first four-quarter increase since the first quarter of 2007."