Interest rates on 30-year fixed-rate mortgages fell this week, reaching the lowest level since June last year, mortgage finance company Freddie Mac said Thursday.
Freddie Mac said rates on the most popular home loan averaged 5.38 percent in the latest week, down from 5.41 percent a week ago. It was the lowest since an average of 5.24 percent in the June 27, 2003 week.
Fifteen-year mortgage rates were unchanged in the week at an average of 4.69 percent.
One-year adjustable rate mortgages slipped to an average of 3.39 percent — a new record low on Freddie Mac records going back to 1984 — down from 3.41 percent last week.
A year ago, 30-year mortgage rates averaged 5.79 percent, 15-year mortgages 5.11 percent and the ARM 3.75 percent.
"Mortgage rates this week are barely above the generational low levels we saw in June of last year," said Freddie Mac chief economist Frank Nothaft. "Indeed Freddie Mac's annual average forecast of long-term mortgage rates is approximately 5.75 Percent for the 30-year (fixed-rate mortgage) this year, well below the 33-year historical average.
"That said, we are currently predicting that this will fuel yet another record year for total home sales," he added.
On Tuesday, the Commerce Department said February housing starts fell 4.0 percent to an annual rate of 1.855 million units.
Freddie Mac said lenders charged an average of 0.7 percent in fees and points on 30-year mortgages, up from 0.6 percent last week. They charged 0.7 percent on 15-year mortgages and 0.6 percent on the ARM, both unchanged from a week ago.
Freddie Mac is a mortgage finance company chartered by Congress that buys mortgages from lenders and packages them into securities for investors or holds them in its own portfolio.