Residential financing rates maintain downward trajectory
Posted on Friday, June 27, 2014 at 7:26:15 AM
At this time last year, residential financing rates were climbing across the country following the announcement of potential Federal Reserve policy changes. One year later, rates are in the midst of a steady, downward trajectory.
According to Freddie Mac, all types of mortgages - both fixed-rate variants as well as adjustable-rate ones - decreased on a weekly basis. For example, the 30-year FRM averaged 4.14 percent for the week ending June 26, compared to last week's 4.17 percent and last year's 4.46 percent. The 15-year FRM reached an average of 3.22 percent, down from the 3.30 percent reported during the previous seven-day period.
"Mortgage rates were down following the release of first quarter real GDP final estimate, which fell at a 2.9 percent annualized rate, a steeper than expected decline and the worst reading since the first quarter of 2009," explained Frank Nothaft, chief economist and vice president at Freddie Mac. "Also, the seasonally-adjusted S&P/Case-Shiller 20-city home price index was up only 0.2 percent in April from the previous month."
In addition, the Mortgage Bankers Association reported that residential financing applications ticked down 1 percent on a weekly basis toward the end of June. The Refinance Index also decreased the same amount during that time. Unchanged from the previous reading was the share of mortgage activity devoted to refinancing, still at 52 percent.