Fixed-Rate Mortgages Continue to Set Record Lows

Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), showing the 30-year fixed-rate mortgage (FRM) averaging 3.67 percent with an average 0.7 point for the week ending June 7, 2012, down from last week when it averaged 3.75 percent. Last year at this time, the 30-year FRM averaged 4.49 percent. Also this week, the 15-year FRM averaged 2.94 percent with an average 0.7 point, down from last week when it averaged 2.97 percent. A year ago at this time, the 15-year FRM averaged 3.68 percent. "Fixed mortgage rates reached new record lows for the sixth consecutive week as long-term Treasury bond yields declined further following downwardly revised economic growth and job creation data," said Frank Nothaft, vice president and chief economist of Freddie Mac. "Gross domestic product rose 1.9 percent in the first quarter, after originally being reported as 2.2 percent, led by gains in inventories, more government cutbacks and the slowest increase in corporate profits in over three years." The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.84 percent this week, with an average 0.7 point, the same as last week. A year ago, the five-year ARM averaged 3.28 percent. The one-year Treasury-indexed ARM averaged 2.79 percent this past week with an average 0.4 point, up from the previous week when it averaged 2.75 percent. At this time last year, the one-year ARM averaged 2.95 percent.  "In addition, the economy added 69,000 jobs in May, less than half of the market consensus forecast and revisions subtracted a total of 49,000 workers in March and April," said Nothaft. "Lastly, the unemployment rate ticked up from 8.1 percent in April to 8.2 percent."