Following the previous week’s uptick, mortgage rates were back down this week in the Freddie Mac Primary Mortgage Market Survey for the week ended Thursday, March 19, 2015.
30-year fixed-rate mortgages, which were at 3.86 percent the week before, eased back by eight basis points, ending the week at 3.78 percent. This is more than 50 basis points lower than last year’s 4.32 percent average. 15-year fixed mortgages were also down, retreating four hundredths of a percentage point from 3.10 percent to 3.06 percent. Last year, 15-year FRMs averaged 3.32 percent.
Five-year ARMs lost four basis points as well, moving down from 3.01 percent to 2.97 percent, which is just five basis points lower than last year’s 3.02 percent average. Finally, one-year ARMs held steady at 2.46 percent, which is three hundredths of a percentage point lower than the previous year’s 2.49 percent.
The mixed nature of recent housing reports was the main reason for this week’s decline, according to Freddie Mac. “The average 30-year fixed mortgage rate fell to 3.78 percent this week following mixed housing data. Housing starts dropped 17 percent to a seasonally adjusted pace of 897,000 units, below market expectations,” said Freddie Mac deputy chief economist Leonard Kiefer in a statement.
“However, housing permits increased 3 percent in February. As we head into spring, home builders remain positive about home sales in the near future although the NAHB Housing Market Index dropped another two points to 53 in March.”
Bankrate’s separate mortgage rate report for the week also showed similar declines in mortgage rates, with spring home buying fast approaching. 30-year FRMs, which were at 3.97 percent last week, moved down six basis points to 3.91 percent, 15-year FRMs dipped three basis points from 3.18 percent to 3.15 percent, and 5/1 ARMs were also down by three basis points, edging from 3.23 percent to 3.20 percent.
The company attributed this week’s lower mortgage interest rates to “soft” economic data, but this time in the manufacturing, home construction, and consumer spending sectors. “Even though the Federal Reserve continues to lay the groundwork for the eventuality of interest rate hikes, any evidence of economic softness only pushes the timetable further out,” continued the company’s statement.
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