30-year mortgage rate falls to 5.85 percent
| • | Current mortgage rates |
By Siobhan Hughes
Bloomberg News Service
WASHINGTON — The average rate on a 30-year fixed mortgage declined this week to the lowest level in almost four decades, according to Freddie Mac, the No. 2 buyer of U.S. mortgages.
The 20-year rate fell from 5.93 percent to 5.85 percent in the week that ends tomorrow, the lowest since the early 1960s.
The average rate on one-year adjustable mortgages rose to 4.06 percent,— up from 4.01 percent, which was the lowest in almost two decades of record-keeping.
"Just when we were sure mortgage rates couldn't possibly drop any lower, we were surprised yet again," said Frank Nothaft, chief economist at the Federal Home Mortgage Corp., better known as Freddie Mac. "We continue to expect, however, that rates will hover around 6 percent for at least another few months."
Low rates are expected to keep housing strong in 2003.
In November alone, new homes sold at the fastest rate on record, led by a surge in purchases in the Midwest, the Commerce Department reported.
This week's 30-year fixed mortgage rate from Freddie Mac puts the average monthly payment on a $100,000 loan, including principal and interest with 1 point, at $589.94, down from $674.73 at the same time last year, when the rate was 7.14 percent.
