Mortgage Rates Inch Lower, Freddie Mac Says

By Dave Sebastian

Mortgage rates dropped slightly over the past week, according to Freddie Mac's latest survey.

For the week ended Thursday, the rate on a 30-day fixed rate mortgage averaged 2.98%, down from 3.02% last week and lower than the 3.07% rate it averaged a year earlier.

"Economic growth remains steady and is bolstering more segments of the economy," said Sam Khater, Freddie Mac's chief economist. "Although low and stable mortgage rates have kept the housing market booming over recent months, a deterioration in affordability and for-sale inventory has led to a market slowdown."

Rates on 15-year fixed-rate mortgages averaged 2.26%, down from 2.34% in the previous week. Rates averaged 2.56% a year earlier, according to Freddie Mac.

Five-year Treasury-indexed hybrid adjustable-rate mortgages, or ARMs, on average stood at 2.54%, up slightly from 2.53% last week and lower than the 3% rate a year earlier.

Mortgage rates fell throughout most of 2020 after the Covid-19 pandemic ravaged the economy. That helped power a boom in mortgage lending, fueled by refinancings. When rates hit 2.98% in July 2020, it was their first time under the 3% mark in some 50 years of record-keeping.

Mortgage rates tend to move in the same direction as the yield on the 10-year Treasury, which has been rising. Treasury yields rise when investors feel confident enough in the economy to forgo safe-haven assets such as bonds for riskier ones including stocks.

Write to Dave Sebastian at dave.sebastian@wsj.com

(END) Dow Jones Newswires

July 01, 2021 10:14 ET (14:14 GMT)

Federal Home Loan Mortgage (QB) (USOTC:FMCC)
Historical Stock Chart
From Mar 2024 to Apr 2024