Mortgage Rates Fall to Record Low
The 30-year fixed-rate mortgage averaged 2.86 percent last week, the lowest rate since at least 1971, reported Freddie Mac, McLean, Va.
“Mortgage rates have hit another record low due to a late summer slowdown in the economic recovery,” said Freddie Mac Chief Economist Sam Khater.
The Freddie Mac Primary Mortgage Market Survey found 30-year fixed-rate mortgages averaged 2.86 percent with an average 0.8 point for the week ending September 10, 2020, down from the prior week, when they averaged 2.93 percent. The 30-year fixed-rate mortgage averaged 3.56 percent a year ago.
Khater said the current low rates have ignited “robust” purchase demand, which increased twenty-five percent from a year ago and has been growing at double-digit rates for the past four months. “However, heading into the fall it will be difficult to sustain the growth momentum in purchases because the lack of supply is already exhibiting a constraint on sales activity,” he said.
The report said 15-year fixed-rate mortgages averaged 2.37 percent last week with an average 0.7 point, down from 2.42 percent the week before. A year ago, 15-year fixed-rate mortgages averaged 3.09 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 3.11 percent last week with an average 0.2 point, up from the prior week when they averaged 2.93 percent. The five-year ARM averaged 3.36 percent one year ago.
The PMMS focuses on conventional, conforming fully amortizing home purchase loans for borrowers who put 20 percent down and have excellent credit. Borrowers may still pay closing costs which are not included in the survey.