Long-term mortgage interest rates remained extremely affordable this week, according to mortgage giant Freddie Mac, slipping slightly from the previous week and staying under the 4 percent mark for two weeks in a row.
The average interest rate on a 30-year fixed rate mortgage fell to 3.97 percent, excluding points, during the week ended November 26, 2014, down from 3.99 percent the week before and down from 4.29 percent a year ago.
“Mortgage rates were little changed on the week with the 30-year fixed-rate mortgage declining to 3.97 percent,” commented Freddie Mac vice president and chief economist Frank Nothaft. “This comes during a week of uplifting economic news heading into the holiday; GDP growth was revised up in the third quarter from 3.5 percent to 3.9 percent, while existing homes sold at a 5.26 million unit pace in October, topping expectations of 5.15 million units.”
Other rates showed no movement in the latest week. The 15-year fixed rate mortgage was unchanged at 3.17 percent from the previous week, although it was down from 3.30 percent the year before. The one-year adjustable rate mortgage was also unchanged in the past week at 2.44 percent. Compared with last year at this time, the rate was down from 2.60 percent.
Historically low rates were not enough to increase mortgage applications during the same week, however. The Mortgage Bankers Association reported that its market composite index, a measure of total loan applications, dropped 4.3 percent in the latest week, with refinance requests falling by 4 percent and home purchase applications sinking 5 percent. Refinance requests made up 63 percent of all mortgage activity during the week. Going into a holiday weekend may have held some buyers and refinancers back, with Thanksgiving through Christmas being a traditionally slow period for mortgage applications.