Interest rates on home loans fell again and are poised come in far lower in the next report. Just 35 basis points separate current fixed rates from their all-time low.
A seven-basis-point point improvement from seven days prior left 30-year fixed rates averaging 3.66 percent in Freddie Mac’s Primary Mortgage Market Survey for the week ended Jan. 15.
The last time 30 year fixed rates were this low was in the week ended May 23, 2013, when the average was 3.59 percent.
“Mortgage rates fell for the third consecutive week as oil prices plummeted and long term treasury yields continued to drop despite a strong employment report,” Freddie Mac Chief Economist Frank Nothaft said in the report.
The lowest level on record for the 30 year was in the week ended Nov. 21, 2012, when it averaged was 3.31 percent.
In this week
last year, the average was 4.41 percent.
Another 13-basis-point or so decline could be ahead in Freddie’s next survey based on Mortgage Daily’s analysis of weekly Treasury market activity.
Nearly two-thirds of panelists surveyed by Bankrate.com for the week Jan. 15 to Jan. 21 agreed with Mortgage Daily’s forecast and predicted mortgage rates will decline over the next week. Another 29 percent projected that rates won’t move more than 2 BPS, and 7 percent predicted an increase.
Jumbo
rates were more than 12 BPS higher than conforming rates in the week ended Jan. 9, according to the U.S. Mortgage Market Index report from LoanSifter/Optimal Blue and Mortgage Daily. The jumbo-conforming spread widened slightly from just under 12 BPS the prior week.
Freddie reported the average 15-year fixed rate at 2.98 percent, 7 BPS better than in the week ended Jan. 8.
The spread between 15- and 30-year fixed rates was unchanged 68 BPS.
At
2.90 percent, five-year, Treasury-indexed, hybrid, adjustable-rate mortgages were down 8 BPS from Freddie’s previous survey.
One-year ARMs averaged 2.37 percent, barely less than the previous week’s 2.39 percent. The one year has fallen 19 BPS from the same week in 2014.
The yield on the one-year Treasury note, which determines changes to one-year ARM rates and payments,
plunged to 0.16 percent Thursday from 0.23 percent one week prior, according to Department of the Treasury data.
No change from a week earlier in another ARM index, the six-month London Interbank Offered Rate, left it at 0.36 percent as of Wednesday, Bankrate.com reported.
ARM share
was just over 9.2 percent in the most-recent Mortgage Market Index report, minimally wider than just under 9.2 percent a week earlier.
