By Amy Hoak
Mortgage rates held steady this week amid mixed reports about
the slowing economy, Freddie Mac's chief economist said on
Thursday.
"Both the core producer price and consumer price indexes ticked
up in January, higher than the market consensus, while consumer
confidence in February fell to the lowest reading since records
began in January 1967," said Frank Nothaft, Freddie Mac chief
economist, in a news release.
Thirty-year fixed-rate mortgages averaged 5.07% for the week
ending Feb. 26, up from last week's 5.04% average but still lower
than their 6.24% average a year ago, according to Freddie Mac's
weekly survey of conforming rates. Meanwhile, 15-year fixed-rate
mortgages averaged 4.68%, unchanged from last week, and down from
5.72% a year ago.
Five-year Treasury-indexed hybrid adjustable-rate mortgages
averaged 5.06% this week, up from 5.04% last week; the ARMs
averaged 5.43% a year ago. One-year Treasury-indexed ARMs averaged
4.81% this week, up slightly from 4.80% last week; the ARMs
averaged 5.11% a year ago.
To obtain the rates, the fixed-rate mortgages and the five-year
ARM required payment of an average 0.7 point, while the one-year
ARM required an average 0.6 point. A point is 1% of the mortgage
amount, charged as prepaid interest.
"Lower house prices and affordable mortgage rates have yet to
spur housing demand," Nothaft said in the news release.
"For instance, house prices declined by 8.7% for the 12 months
ending in December 2008 and were down 10.9% from their highs set in
April of 2007, according to the Federal Housing Finance Agency's
purchase-only monthly home price index.
"However, existing home sales (excluding condominiums and
co-ops) fell 4.7% in January to 4.05 million units (annualized),
the slowest pace since July 1997," he said.
The Mortgage Bankers Association on Wednesday said that mortgage
rates rose last week, and the volume of mortgage applications fell
a seasonally adjusted 15.1%, compared with the week before.
-Amy Hoak; 415-439-6400; AskNewswires@dowjones.com
