Freddie Mac: Residential financing rates remain low
Posted on Thursday, September 11, 2014 at 10:09:15 AM
A recent report from government-sponsored enterprise Freddie Mac has shown that residential financing rates have avoided a major increase over the past few weeks, still down near recent lows.
This is good news for potential homebuyers, as lower rates are a plus for affordability. Freddie Mac noted that the 30-year fixed-rate mortgage averaged 4.12 percent for the week ending Sept. 11. That is a slight uptick compared to the previous seven-day period's 4.10 percent. The 15-year FRM averaged 3.26 percent during this time, up from 3.24 percent.
"Mortgage rates were up slightly this week, following the increase in 10-year Treasury yields, despite last week's disappointing employment report," explained Frank Nothaft, chief economist and vice president for Freddie Mac. "The U.S. economy added only 142,000 jobs in August, after a 212,000 gain in July and a 267,000 increase in June. The unemployment rate fell to 6.1 percent in August from 6.2 percent the previous month."
In addition to this trend, the Mortgage Bankers Association reported that interest in residential financing dropped on a weekly basis in early September. For the seven-day period ending Sept. 5, mortgage applications declined 7.2 percent to their lowest level since December 2000. The refinance share of total mortgage activity slipped as well, down from 57 percent to 55 percent.