Mortgage rate decline biggest in nine months
| • | Hawai'i Mortgage Rates |
By Carlos Torres
Bloomberg News Service
WASHINGTON — The average rate on a 30-year fixed mortgage dropped the most in nine months this week, suggesting home sales will stay strong, according to Freddie Mac, the No. 2 buyer of U.S. mortgages.
The 30-year fixed rate declined to 6.13 percent this week from 6.31 percent last week. That's the biggest drop since late January.
The average rate on one-year adjustable mortgages fell to 4.25 percent from 4.30 percent.
The 15-year fixed rate fell to 5.51 percent from 5.70 percent.
Fixed mortgage rates are close to the 5.98 percent reached in October — the lowest in 32 years of record-keeping. New homes sales reached a record this fall and will probably stay strong.
"With mortgage rates falling this week from already affordable levels, interest in home buying will remain strong coming into and through the holiday season," said Frank Nothaft, chief economist at Freddie Mac. "Although the economy is expected to get little help form the retail sector, current low mortgage rates should continue to fuel the housing market providing strength to the economy."
Sales of new homes increased 0.4 percent in September to a record 1.02 million annual rate, the Commerce Department said last week. Existing single-family homes sold at a 5.4 million-unit rate, up 1.9 percent from August, the National Association of Realtors also said last week.
This week's 30-year fixed mortgage rate from Freddie Mac puts the average payment on a $100,000 loan, including principal and interest with 1 point, at $607.93, down from $636.02 at the same time last year, when the rate was 6.56 percent.
