Fixed-Rates Edging Back Toward the Four Percent Range

Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), showing average fixed mortgage rates falling for the third consecutive week amid declining consumer confidence and the onset of the federal government shutdown. The average 30-year fixed-rate mortgage (FRM) is at its lowest level since the week ending June 20, 2013. This week, the 30-year FRM averaged 4.22 percent with an average 0.7 point for the week ending Oct. 3, 2013, down from last week when it averaged 4.32 percent. A year ago at this time, the 30-year FRM averaged 3.36 percent. Also this week, the 15-year FRM averaged 3.29 percent with an average 0.7 point, down from last week when it averaged 3.37 percent. A year ago at this time, the 15-year FRM averaged 2.69 percent. "With the onset of the federal government shutdown and declining consumer confidence, fixed mortgage rates fell for the third consecutive week," said Frank Nothaft, vice president and chief economist, Freddie Mac. "Consumer sentiment fell for the second month in a row in September to its lowest reading since April, according to the University of Michigan. Moreover, a recent Bloomberg survey of professional forecasters suggests that a partial federal shutdown lasting one week would shave 0.1 percentage points off of GDP growth in the fourth quarter and even more if the shutdown lasts longer." The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.03 percent this week with an average 0.6 point, down from last week when it averaged 3.07 percent. A year ago, the five-year ARM averaged 2.72 percent. The one-year Treasury-indexed ARM averaged 2.63 percent this week with an average 0.4 point, unchanged from last week. At this time last year, the one-year ARM averaged 2.57 percent.