Mortgage Rates Continue to Drift

Mortgage Rates Continue to Drift Lower as Housing Market Eases Back from Record Highs
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 6.44 percent with an average 0.4 point for the week ending August 31, 2006, down from last week's average of 6.48 percent. Last year at this time, the 30-year FRM averaged 5.71 percent. This is the lowest the 30-year FRM has been since the week ending April 6, 2006, when it averaged 6.43 percent.
The average for the 15-year FRM this week is 6.14 percent, with an average 0.4 point, down from last week when it averaged 6.18 percent. A year ago, the 15-year FRM averaged 5.32 percent. This is the lowest the 15-year FRM has been since the week ending April 6, when it was 6.10 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) fell to 6.11 percent this week, with an average 0.5 point, down from last week's rate of 6.14 percent. A year ago, the five-year ARM averaged 5.30 percent. This is the lowest the five-year ARM has been since March 30, 2006, when it was 6.02 percent.
One-year Treasury-indexed ARMs averaged 5.59 percent this week, with an average 0.7 point, was down from last week when it averaged 5.60 percent. At this time last year, the one-year ARM averaged 4.48 percent. This is the lowest the one-year ARM has been since April 6, 2006, when it was 5.57 percent.
"Mortgage rates continued to drift lower this week in large part because of the cooling in the housing market and in consumer confidence, thus giving financial markets reason to believe that economic growth will moderate and inflation will remain in check," said Frank Nothaft, Freddie Mac vice president and chief economist. "As a matter of fact, the 30-year FRM is nearly 40 basis points lower than its peak of 6.8 percent in July of this year."
"By some indicators, personal incomes are growing faster than the cost of housing. Combined with the still historically low mortgage rates, this will help to support the housing industry as it levels off from the record highs of the last few years."
Published: September 1, 2006 in “Realty Times” newsletter written by Blanche Evans

In Central Ohio the 30 year fixed rate mortgage on September 1st was as low as 6.125%. With prices leveling off and moving slightly lower than last year in some areas of town, now is an excellent time to buy real estate.
Jim Lubinsky
614-766-5330