Mortgage rates fell again this week, reaching yet another record low, according to a Bankrate survey released Wednesday.
The average cost of a 30-year fixed-rate mortgage fell to 2.99 percent from last week’s 3 percent in Bankrate’s national survey of lenders. The 15-year fixed also set a new record, falling to 2.39 percent. Bankrate includes origination points and other fees in its figure. The 30-year fixed-rate loans in this week’s survey included an average total of 0.32 discount and origination points.
Mortgage rates have been in steady decline since the coronavirus recession began earlier this year, a trend that has helped drive the surprisingly strong housing market. However, rates ticked up a bit last month and stocks soared on optimism about the presidential election, potential vaccines for the coronavirus and an improving labor market.
The recent drop in mortgage rates reflects mixed signals from the economy. An autumn spike in coronavirus cases undermined hopeful signs that a COVID-19 vaccine soon will be available, and the economic recovery so far has been uneven and incomplete.
Jennifer Kouchis, senior vice president at VyStar Credit Union in Jacksonville, expects rates to hold steady. “For now I think rates will continue to trend sideways as they ignore what used to be the normal indicators of market movement.”
Nearly half of mortgage experts polled by Bankrate expect rates to remain the same in the coming week. The 10-year Treasury yield, a key indicator for mortgage rates, flirted with 1 percent last month but was at 0.94 percent as of Wednesday.
“The rise of the 10-year has stalled, and so will the movement of mortgage rates,” says Ralph McLaughlin, chief economist at financial technology firm Haus.com.