Fixed mortgage rates sank to their lowest levels since June, according to the latest data released Thursday by Freddie Mac.
For the second week in a row, mortgage rates tumbled among concerns about a softening housing market.
The 30-year fixed-rate average slid to 4.1 percent with an average 0.7 point. It was down from 4.13 percent a week ago but up from 3.39 percent a year ago. The 30-year fixed rate has not been this low since it averaged 3.93 percent in late June.
The 15-year fixed-rate average dropped to 3.2 percent with an average 0.7 point. It was 3.24 percent a week ago and 2.7 percent a year ago. The 15-year fixed rate, which reached its highest level in August at 3.6 percent, has not been below 3 percent since late May.
Hybrid adjustable rate mortgages were mixed. The five-year ARM average fell to 2.96 percent with an average 0.4 point. It was 3 percent a week ago and 2.74 percent a year ago. The five-year ARM has remained above 3 percent since late June.
The one-year ARM average rose to 2.64 percent with an average 0.4 point. It was 2.6 percent a week ago.
“Fixed mortgage rates eased further leading up to the Federal Reserve’s October 30th monetary policy announcement,” Frank E. Nothaft, Freddie Mac vice president and chief economist, said in a statement. “The Fed saw improvement in economic activity and labor market conditions since it began its asset purchase program, but noted the recovery in the housing market slowed somewhat in recent months and unemployment remains elevated. As a result, there was no policy change which should help sustain low mortgage rates in the near future.”
Meanwhile, a week after mortgage rates plummeted to four-month lows, mortgage applications showed a strong rebound, according to the latest data from the Mortgage Bankers Association.
The Market Composite Index, a measure of total loan application volume, climbed 6.4 percent. The Refinance Index spiked 9 percent, while the Purchase Index increased 2 percent.
The refinance share of mortgage activity rose to 67 percent. In early September, the refinance share had sunk to 57 percent, its lowest level since April 2010. Refinances had accounted for more than 80 percent of applications earlier this year.