Signs of Low Inflation Keep Long Term Mortgage Rates Steady
McLEAN, VA -- Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 6.15 percent with an average 0.5 point for the week ending May 10, 2007, down slightly from last week when it averaged 6.16 percent. Last year at this time, the 30-year FRM averaged 6.58 percent. The 15-year FRM this week averaged 5.87 percent with an average 0.5 point, unchanged from last week when it averaged 5.87 percent. A year ago, the 15-year FRM averaged 6.17 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.89 percent this week, with an average 0.6 point, up slightly from last week when it averaged 5.87 percent. A year ago, the 5-year ARM averaged 6.22 percent. One-year Treasury-indexed ARMs averaged 5.48 percent this week with an average 0.7 point, up from last week when it averaged 5.42 percent. At this time last year, the 1-year ARM averaged 5.62 percent. "Low employment growth in April -- the slowest pace since November 2004 -- and downward revisions to both February and March job growth tempered market concerns of future increases in the rate of inflation," said Frank Nothaft, Freddie Mac vice president and chief economist. "As a result, mortgage rates were little changed this week." "Despite a slowdown in house price growth, borrowers continue to refinance their loans, extracting approximately $70.5 billion in cash from their home equity in the first quarter of 2007, down slightly from $77.0 billion in the fourth quarter of 2006. According to the Federal Reserve Board, homeowners had nearly $11 trillion in home equity at the end of 2006, an increase of 30 percent over the past three years." |
