Low rates continue to attract borrowers who want to refinance their homes
Mortgage rates last week continued to hover near record lows for the third consecutive week, according to the Freddie Mac Primary Mortgage Market Survey.
“As a result, refinance activity remains high, but home-purchase demand is weak due to economic tightening,” said Freddie Mac Chief Economist Sam Khater.
The rate for the 30-year mortgage dipped last week to 3.31% from 3.33% the week prior. A year ago at this time, the 30-year fixed-rate mortgage (FRM) was 4.17%.
Meanwhile, the 15-year mortgage saw an uptick last week. The 15-year FRM was up from 2.77% to 2.80% week-over-week but was down from last year's 3.62% average.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) fell a few basis points from the previous week, down from 3.40% to 3.34%. At this time in 2019, the 5-year ARM was 3.78%.
“While new monthly economic data are driving markets lower this week, they are a lagging indicator and should be priced in already," Khater said. "Real-time daily economic activity metrics suggest that the economy will likely not decline much further. Going forward, the key question is no longer the depth of the economic contraction, but the duration.”
