Shorter Term Rates Drift Ever So Slightly Lower
McLEAN, VA -- Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market SurveySM (PMMSSM) in which the 30-year fixed-rate mortgage (FRM) averaged 6.62 percent, with an average 0.4 point, for the week ending May 25, 2006, up from last week's average of 6.60 percent. Last year at this time, the 30-year FRM averaged 5.65 percent. The 30-year FRM has not been higher since the week ending June 20, 2002, when it averaged 6.63 percent. The average for the 15-year FRM this week is 6.23 percent, with an average 0.4 point, up from last week's average of 6.20 percent. A year ago, the 15-year FRM averaged 5.21 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.21 percent this week, with an average 0.6 point, down from last week when it averaged 6.23 percent. A year ago, the five-year ARM averaged 5.07 percent. One-year Treasury-indexed ARMs averaged 5.61 percent this week, with an average 0.7 point, down slightly from last week when it averaged 5.62 percent. At this time last year, the one-year ARM averaged 4.21 percent. "Currently, mortgage rates are roughly a half a percentage point higher than they were at the start of the year, which has led to some moderation in the housing market," said Frank Nothaft, Freddie Mac vice president and chief economist. "Indeed, in the first quarter of 2006, the housing industry directly accounted for only seven percent of real Gross Domestic Product (GDP), compared to 19 percent in the fourth quarter of 2005." "Total housing starts for April were the weakest since November 2004, and although new home sales in April were the strongest this year, the number of homes for sale hit a record high. Meanwhile, existing home sales declined an expected two percent, further evidence of an easing in housing." |
