Interest rates on conventional purchase-money mortgages are down, according to the Federal Housing Finance Agency index released today. The average interest rate on all mortgage loans was down 12 basis points in February. Average interest rates were 3.77 percent in February compared to 3.89 in January.
Freddie Mac also reported mortgage rate decreases in their Primary Mortgage Market Survey today. According to Freddie, average fixed rates continue to run below four percent and will keep affordability high for those in the market to buy a home as we head into the spring homebuying season. The current 30-year fixed rate sits at 3.69 percent.
"The average 30-year fixed mortgage rate fell to 3.69 percent this week following a decline in 10-year Treasury yields. Low mortgage rates are a welcome sign for those in the market to buy a home this spring season and will help to support homebuyer affordability,” Freddie Mac chief economist, Len Keifer, said in a press release. “Existing home sales in February increased slightly, but less than expected, to a seasonally adjusted annual rate of 4.88 million units. Meanwhile, new home sales outperformed expectations and surged 7.8 percent to an annual pace of 539,000 units."
The FHFA index showed the effective interest rate on all mortgage loans was down 12 basis points in February from the month prior. The February rate was 3.92 percent down form the January rate of 4.04 percent. The effective interest rate accounts for the addition of initial fees and charges over the life of the mortgage.
The National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders index was 3.77 percent for loans closed in late February, down 11 basis points from 3.88 percent in January.
The average interest rate on conventional, 30-year, fixed-rate mortgages of $417,000 or less was 3.91 percent, a decrease of 15 basis points from 4.06 in January.The average loan amount for all loans was $294,200 in February, up $2,900 from $291,300 in January.
The FHFA released their Home Price Index earlier this week, reporting a 5.1 percent increase in home prices from January 2014 to January 2015. FHFA principal economist Andrew Leventis said the January-to-January increases were strong due to modest inflation in the overall economy.