Mortgage rates for fixed 30-year loans in the U.S. dropped to a record low of 4.71 percent for the week ended today, the lowest since Freddie Mac began compiling the data in 1971. Rates on 15-year fixed-rate mortgages were 4.27%, down from last week's prior low of 4.29% and 5.77% a year earlier. This comes amid signs that the housing market is beginning to emerge from the worst slump since the 1930s.
Five-year adjustable-rate mortgages averaged 4.19%, up from last week's record low of 4.18% but were down from 5.77% a year earlier. One-year ARMs were 4.25%, its lowest level since June 2005, down from 4.35% last week and 5.02% a year earlier.
Economists at Huntington National Bank in Columbus, Ohio speculate that rates probably won’t go any lower, and that they’re at the lowest point they are going to achieve in a long time.
The index of signed purchase agreements, or pending home sales, climbed 3.7 percent to 114.1 after rising 6 percent in September, the National Association of Realtors said on December 1st.
The low mortgage costs, in addition to the recent extension of the new homebuyer tax credit, have increased the demand for property. In October the demand for contracts to buy previously owned homes increased and the demand for applications for mortgages continue to increase.
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