Fixed-rate mortgages, 5-year ARMs hit lows: Freddie Mac
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6/24/10CHICAGO (MarketWatch) — Rates on fixed-rate mortgages and the 5-year adjustable-rate mortgage dropped to record lows this week, according to Freddie Mac’s weekly survey of conforming mortgage rates, released on Thursday.
The 30-year fixed-rate mortgage averaged 4.69% for the week ending June 24, down from 4.75% last week and 5.42% a year ago. Fifteen-year fixed-rate mortgages averaged 4.13%, down from 4.20% last week and 4.87% a year ago.
And the 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.84% this week, down from 3.89% last week and 4.99% a year ago.
One-year Treasury-indexed ARMs averaged 3.77%, down from 3.82% last week and 4.93% a year ago. While not a record, this is the lowest the ARM has been since the week ending May 6, 2004, when it averaged 3.76%.
To obtain the rates, the 30-year fixed-rate mortgage and both ARMs required payment of an average 0.7 point and the 15-year fixed-rate mortgage required an average 0.6 point. A point is 1% of the mortgage amount, charged as prepaid interest.
“Mortgage rates for all but traditional 1-year ARMs hit all-time record lows this week in our survey while activity in the housing market slowed in May following the expiration of the home-buyer tax credit,” said Frank Nothaft, Freddie Mac vice president and chief economist, in a news release. “Freddie Mac began collecting rates for 30-year fixed loans in April 1971, 15-year fixed mortgages in September 1991 and 5-year hybrid ARMs in January 2005.”
New and existing home sales showed declines in May, Nothaft pointed out.
“Existing sales fell 2.2%, compared to the market consensus forecast of a 6% gain, based on figures published by the National Association of Realtors. Sales of new homes fell 32.7% to an annualized rate of 300,000 units, which was the largest monthly drop and slowest pace since records began in 1963, according to the Census Bureau,” he said.
Read more on new-home sales. Read more on existing-home sales.
Amy Hoak is a MarketWatch reporter based in Chicago.
