Freddie Mac released its weekly update on national mortgage rates Thursday morning -- and homebuyers released a sigh of relief.
Despite continued talk of a possible taper in Fed bond-buying, 30-year fixed-rate mortgages (FRMs) got four basis points cheaper over the past week, falling to 4.42%. Fifteen-year FRMs similarly cheapened by four b.p., falling to 3.43%.
Seekers of shorter term, adjustable-rate mortgages (ARMs) benefited even more, with 5/1 ARMs declining five basis points in price, to 2.94%. One-year ARMs dropped to 2.51%.
Rates remain historically low. A year ago, 30-year FRMs were averaging 3.32% and 15-year FRMs were averaging 2.66%. A year ago, the five-year ARM averaged 2.70% and the one-year ARM averaged 2.53%.
Freddie Mac vice president and chief economist Frank Nothaft characterized the numbers as "little changed" from last week. He noted in a statement that reports were released about a decline in unemployment to the 7% mark plus the first rise in single family mortgage debt seen since 2008. These both suggest strength in the economy that could give the Federal Reserve room to raise its target interest rate.