Your dear friends here at Movoto have some good news and some bad news for you, the consumer.
First, the good news (for home buyers, anyway) courtesy of Realty Times: According to home mortgage giant Freddie Mac in their newest Primary Mortgage Market Survey® (PMMS®), both fixed and adjustable mortgage rates have slumped once again, dipping down to new, all-time record lows, breaking the previous lows for both fixed mortgage and 1-year ARM rates set back on August 18th, 2011. As for 5-Year ARM rates, they stayed at 2.96%, the all-time record low set just this past week.
Last week and year, a 30-year fixed-rate mortgage (FRM) at this time was 4.22% and 4.35%, respectively; it is now 4.12% with an average 0.7 point for the week. Meanwhile, a 15-year FRM used to be 3.39% last week and 3.83% last year; that number has dropped to 3.33% with an average 0.6 point for the week. Last week and year, a 1-year Treasury-indexed ARM sat at 2.89% and 3.46%, respectively; the rate now stands at 2.84% with an average 0.6 point for the week. And finally, a 5-year Treasury-indexed hybrid ARM a year ago was 3.56%; this week and last, it remains at 2.96% with an average 0.6 point for the week.
So what’s the bad news? Well, we’ll let Freddie Mac’s vice president and chief economist, Frank Nothaft, explain just why mortgage rates have dropped yet again:
“Market concerns over Eurozone sovereign debt default and a weak U.S. employment report for August placed downward pressure on Treasury bond yields and allowed fixed mortgage rates to hit new lows this week. On net, the economy added no new jobs last month and was the weakest reading since September 2010. Meanwhile, the unemployment rate remained at 9.1 percent, marking its 31st consecutive month of being above 8 percent, the longest such stretch in 70 years.”
Unfortunately, Mr. Nothaft wasn’t finished with the bad economic news. He continued by saying that:
“The Federal Reserve (Fed) painted a bleaker picture as well in its September 7th regional economic review. Seven of its 12 Districts reported more subdued views of business conditions. Many of the Fed’s manufacturing contacts downgraded or became more cautious about their near-term outlooks due to increased economic uncertainty.”
All of this economic, employment, and market uncertainty is definitely bad news to everyone. But at least you can continue to get a mortgage for dirt cheap. Silver lining, people, silver lining.
Stephanie Huskey is the resident real estate blogger for Movoto and doesn’t have a clue when mortgage rates will finally bottom out since she is, unfortunately, not a psychic. Interested in getting her advice on your blog? She’s currently seeking guest blogging opportunities so she can share her knowledge with new communities! You can find her over here at Elance.com.
Who is Movoto Real Estate, you might ask? Movoto is an online real estate brokerage based in San Mateo, CA. Our blog has been recognized for its unique approach to city-based research by major news organizations around the world such as Forbes and CBS News.