Mortgage Rates Trend Down As Weak Unemployment Report Signals Softer Economy
October 15, 2004
McLean, VA – The results of Freddie Mac's (NYSE:FRE) Primary Mortgage Market Survey in which the 30-year fixed-rate mortgage (FRM) averaged 5.74 percent, with an average 0.6 points, for the week ending October 14, 2004, down from last week when it averaged 5.82 percent. Last year at this time, the 30-year FRM averaged 5.95 percent.
The average for the 15-year FRM this week is 5.14 percent, with an average 0.6 points, also down from last week when it averaged 5.24 percent. A year ago, the 15-year FRM averaged 5.26 percent.
One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 4.01 percent this week, with an average 0.6 point, lower than last week when it averaged 4.08 percent. At this time last year, the one-year ARM averaged 3.69 percent.
“The decline in mortgage rates was primarily due to a weak employment report for September, which suggested economic growth is still a bit subdued. As a result, we expect mortgage rates will continue to stay quite affordable over the next few months, benefiting future homebuyers,” said Freddie Mac’s Chief Economist Frank Nothaft. “Of late, there has been no compelling economic reason to believe mortgage rates would climb out of their recent range.
“Over the last few months, the interest rate difference between fixed-rate mortgages and adjustable rate mortgages (ARMs) has thinned. If this continues, ARMs may lose some appeal amongst homeowners in the coming months,” added Nothaft.
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Source: Freddie Mac
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