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 6.52 percent with an average 0.3 point for the week ending August 17, 2006, down from last week's average of 6.55 percent. By contrast the 30-year FRM averaged 6.80 percent four weeks ago. Last year at this time, the 30-year FRM averaged 5.80 percent.
The average for the 15-year FRM this week is 6.20 percent, with an average 0.3 point, unchanged from last week. A year ago, the 15-year FRM averaged 5.40 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) fell to 6.18 percent this week, with an average 0.4 point, from last week's rate of 6.21 percent. A year ago, the five-year ARM averaged 5.34 percent.
One-year Treasury-indexed ARMs averaged 5.65 percent this week, with an average 0.5 point, was down from last week when it averaged 5.69 percent. At this time last year, the one-year ARM averaged 4.58 percent.
"Long term rates continue to relax as economic reports support a picture of a weakening housing sector and a slower growing economy," said Frank Nothaft, Freddie Mac vice president and chief economist. "This week's news that July housing starts fell 2.5 percent added conviction to Fed Fund futures traders who are currently pricing contracts to suggest the chances of another rate increase from the central bank this year are about fifty-fifty."
"As a result, 30-year fixed-rate mortgages are down for the fourth straight week and are the lowest they've been since mid-April. Meanwhile, ARM rates have gone down less. All of which could help persuade homeowners with ARMs on the verge of resetting to make the decision to lock into a fixed-rate mortgage now rather than take a chance of a higher rate on the adjustment date."