Concerns about the economy both domestically and abroad are driving down mortgage rates. In new data released last week by mortgage giant Freddie Mac, the 30-year fixed-rate mortgage rates are now at a 52-week low. Cheaper mortgages could be a shot in the arm to the housing market after several months of declining sales and price growth.
Further driving rates down was an announcement by the Federal Reserve that it will hold rates steady and will likely not increase rates for the rest of the year. Currently, Fed Funds futures place the probability of a rate cut by the end of the year as high as 51 percent. The news caused bond yields to stumble. Mortgage rates are closely linked to the yield on the 10-year Treasury bond.
Currently, rates are significantly lower than they were last fall and experts predict that there are more drops to come. Conforming no-point 30-year fixed mortgage rates are averaging 4.125 percent, 15-year rates are near 3.625 percent and the 5-year ARM is averaging 4.00 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.