Long-term mortgage interest rates careened downhill again in the latest week, according to mortgage giant Freddie Mac, the result of a handful of anemic domestic financial reports.
The average rate on a 30-year fixed rate conventional mortgage fell to 3.59 percent, excluding fees, during the week ended February 5, 2015, down from 3.66 percent the previous week. The new rate is down from 4.32 percent one year.
Average rates have now tied the 20-month low of 3.59 percent during the week of May 23, 2013. During the next month, mortgage rates jumped dramatically in response to the Federal Reserve’s talk of tapering its bond-buying program. Since the end of that 2103 summer, rates have made slow but steady descent as global markets have faltered and domestic data has been hit-or-miss. This week it was a miss.
“Mortgage rates fell this week following the release of weaker than expected pending home sales, which fell 3.7 percent in December,” said Freddie Mac deputy chief economist Len Kiefer. “Moreover, real GDP growth for the fourth quarter was 2.6 percent and the Institute for Supply Management reported slower growth in manufacturing last month, both missing market consensus forecasts.”
Other rates fell as well in the latest week. The 15-year fixed rate conventional mortgage dropped to 2.92 percent, down from 2.98 percent the week before and 3.40 percent a year earlier. The one-year adjustable rate mortgage rate rose, however, inching up to 2.39 percent from 2.38 percent the week before, but still down from 2.55 percent during the same week of February 2014.
The lower mortgage rates of the past several weeks have contributed to a major upswing in refinancing but have not been able to push home sales as high as would be expected due to limited inventory in some areas and rising prices.