- 4.66% (30-year fixed)
- 0.47 (average points)
In a week when a report showed home sales taking a serious decline, and the Federal Reserve acknowledging the housing sector remains highly troubled, mortgage rates fell nearly across the board.
In the latest Bankrate survey, the fixed 30-year mortgage dipped to 4.66 percent, compared to 4.71 percent last week, a decline of 5 basis points.
Other rates followed suit. The 15-year fixed-rate mortgage averaged 3.83 percent, a decline of 3 basis points. A basis point is one-hundredth of 1 percentage point. Jumbo fixed-rate mortgages, which are generally those for over $417,000, were an exception, climbing 3 basis points and settling at 5.23 percent.
In the adjustable mortgage segment, the 5/1 ARM fell to 3.36 percent, from 3.4 percent last week.
Housing's woes were noted in the statement released at the conclusion of the Federal Open Market Committee's meeting Wednesday. The FOMC, which is the policymaking body of the Federal Reserve, noted that "the housing sector continues to be depressed." The FOMC affirmed its commitment to keeping short-term interest rates near zero "for an extended period."
The weakness in housing was reflected in a new report, released Tuesday by the National Association of Realtors. The NAR found that sales of existing homes sank 3.8 percent in May, to an annualized rate of 4.81 million home. The figure includes single-family homes, town houses, condominiums and co-ops.
That was the weakest monthly report this year, and well below the 5 million rate of April. It was 15 percent below May 2010, when sales were helped by a rush to beat the deadline for a homebuyer tax credit.
"Current housing market activity indicates a very slow pace of broader economic activity, but recent reversals in oil prices are likely to mitigate the impact going forward," Lawrence Yun, the NAR's chief economist, said in a statement released with the report. He predicted sales activity will be stronger in the second half of the year, which should also be stronger than the second half of 2010.-- Gregg Fields