RISMEDIA, Jan. 11, 2008-Freddie Mac released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.87% with an average 0.4 point for the week ending January 10, 2008, down from last week when it averaged 6.07% as well. Last year at this time, the 30-year FRM averaged 6.21%.
The 15-year FRM this week averaged 5.43% with an average 0.4 point, down from last week when it averaged 5.68%. A year ago at this time, the 15-year FRM averaged 5.96%.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.63% this week, with an average 0.5 point, down from last week when it averaged 5.78%. A year ago, the 5-year ARM averaged 6.03%.
One-year Treasury-indexed ARMs averaged 5.37% this week with an average 0.4 point, down from last week when it was 5.47%. At this time last year, the 1-year ARM averaged 5.44%.
“The latest employment report showed that the economy added 18,000 jobs in December, the smallest gain since August 2003, and the unemployment rate jumped to a two-year high of 5 percent. In addition, the Institute for Supply Management’s index of non-manufacturing business activity showed that the service sector had the slowest expansion in nine months during December,” said Frank Nothaft, Freddie Mac vice president and chief economist. “The National Association of Realtors also indicated a drop in its pending home sales index for November, signaling a possible slowdown in December sales. These weak economic reports renewed concerns about economic conditions in the near future. As a result, mortgage rates came down across the board, with 30-year fixed mortgage rates at their lowest level in more than two years.
“Because average mortgage rates have come down more than a quarter of a percentage point in the past two weeks, there has been a pickup in refinance activity as borrowers take advantage of the lower rates. For the first week of 2008, the Mortgage Bankers Association reported an increase in the refinance share of mortgage applications and the pace of overall applications, both at the highest levels in four weeks.”