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The Honolulu Advertiser
Posted on: Friday, February 8, 2008

Mortgage rates dip further Housing market still weak

By Martin Crutsinger
Associated Press

WASHINGTON — Rates on 30-year mortgages dipped slightly this week, the fifth decline in the past six weeks.

Mortgage company Freddie Mac reported yesterday that 30-year fixed-rate mortgages averaged 5.67 percent this week, down from 5.68 percent last week. The 30-year mortgage has been below 6 percent for five weeks — something analysts attribute to growing concerns about a recession.

"Economic news released in the past week showed that the economy continues to be weak," said Frank Nothaft, chief economist for Freddie Mac.

Another factor pushing mortgage rates lower was the decision by the Federal Reserve last week to cut a key interest rate for a second time in January in an effort to keep the country out of a recession.

Analysts are hoping these low mortgage rates will help spur a rebound in the housing market, which suffered steep declines last year. But new data showed the housing doldrums continue. The National Association of Realtors reported that pending home sales fell by 1.5 percent in December to the second-lowest reading on record.

Rates on other mortgages also went down this week: 15-year mortgages dipped to 5.15 percent, from 5.17 percent last week; five-year adjustable-rate mortgages to 5.21 percent, down from 5.32; and one-year adjustable-rate mortgages to 5.03 percent, from 5.05 percent.

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