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Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), showing an investor flight to safety for U.S. Treasuries is pushing average fixed mortgage rates lower and helping to keep buyer activity strong toward the close of the spring homebuying season. The 30-year fixed-rate mortgage (FRM) averaged 4.04 percent with an average 0.6 point for the week ending July 9, 2015, down from last week when it averaged 4.08 percent. A year ago at this time, the 30-year FRM averaged 4.15 percent. Also this week, the 15-year FRM this week averaged 3.20 percent with an average 0.5 point, down from last week when it averaged 3.24 percent. A year ago at this time, the 15-year FRM averaged 3.24 percent.
"Yields on Treasury securities declined this week in response to investor concerns about events in Greece and China," said Sean Becketti, chief economist, Freddie Mac. "Mortgage rates fell as well, although not by as much as government bond yields. The rate on 30-year fixed-rate mortgages fell 4 basis points to 4.04 percent."
The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.93 percent this week with an average 0.4 point, down from last week when it averaged 2.99 percent. A year ago, the five-year ARM averaged 2.99 percent. The one-year Treasury-indexed ARM averaged 2.50 percent this week with an average 0.3 point, down from last week when it averaged 2.52 percent. At this time last year, the one-year ARM averaged 2.40 percent.
"Overseas volatility is likely to persist for some time, providing some restraint on potential U.S. rate increases," said Becketti. "In addition, the minutes of the June meeting of the Federal Open Market Committee suggest the Federal Reserve will proceed cautiously—monitoring events both overseas and in the U.S. to ascertain the appropriate moment to begin raising short-term interest rates. As a result, mortgage rates may remain in the neighborhood of four percent for a while."