Mortgage rates tumbled for the fourth week in a row, according to the latest data released by Freddie Mac.
The 30-year fixed-rate average fell to 3.4 percent with an average 0.8 point, the third week in a row it was below 3.5 percent. It was down from 3.41 percent last week and 3.88 percent a year ago. The lowest the 30-year fixed rate had been was 3.31 percent on Nov. 21.
The 15-year fixed-rate average hit an historic low, falling to 2.61 percent with an average 0.7 point. It was 2.64 percent a week ago and 3.12 percent a year ago. The previous low for the 15-year fixed rate was 2.63 percent on Nov. 21. It hasn’t been above 3 percent for nearly a year.
Hybrid adjustable rate mortgages were down as well. The five-year ARM dropped to 2.58 percent with an average 0.5 point. It was 2.6 percent last week. The one-year ARM slid to 2.62 percent with an average 0.3 point. It was 2.63 percent last week.
Frank E. Nothaft, Freddie Mac vice president and chief economist, credits the low interest rates for boosting the housing market.
“Existing home sales averaged an annualized pace of 4.94 million over the first three months of this year, the most since the fourth quarter of 2009,” Nothaft said. “More impressively, new home sales topped 424,000 during the first quarter, which was the strongest since the third quarter of 2008.
“The sales pickup is helping to support house-price gains. For instance, the Federal Housing Finance Agency reported that February marked the thirteenth consecutive month that it has recorded an annual rise in its U.S. house price index, which rose by 7.1 percent in the twelve months through February, the most since May 2006. Even with these gains, this U.S. index is still 13.6 percent below its peak set in April 2007.”
Meanwhile, the low interest rates had little effect on mortgage applications, according to the Mortgage Bankers Association.
The Market Composite Index, a measure of loan application volume, barely edged up, growing just 0.2 percent from the previous week. The Refinance Index rose 0.3 percent, while the Purchase Index increased just 0.3 percent.
The refinance share of mortgage activity remained unchanged from the previous week, accounting for 75 percent of total applications.