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Mortgage Rates Slip on Mixed Housing News

ratesAfter jumping up last week, mortgage rates were weighed down in the latest measure by mixed housing developments.

Freddie Mac [1] released Thursday the results of its Primary mortgage Market Survey [2], showing the 30-year fixed-rate mortgage (FRM) easing to an average interest rate of 4.20 percent (0.5 point) for the week ending September 25. The 30-year FRM averaged 4.23 percent in the previous week's survey, a four-month high.

The 15-year FRM averaged 3.36 percent (0.5 point), down a basis point from the last report.

"Mortgage rates were slightly changed with the rate on the 30-year fixed mortgage down three basis points," said Frank Nothaft, VP and chief economist at Freddie Mac. "Meanwhile, existing home sales dropped 1.8 percent in August to a seasonally-adjusted annual rate of 5.05 million. Sales of new single-family homes surged 18.0 percent in August to an annual pace of 504,000 units. Also, the Federal Housing Finance Agency reported house prices rose just 0.1 percent on a seasonally-adjusted basis in July, and were up 4.4 percent over the past year."

Releasing its own survey [3], Bankrate.com [4] recorded the 30-year fixed average at 4.30 percent, down from 4.33 percent previously, while the 15-year fixed was unchanged at 3.46 percent.

"Some nervousness about the global economy proved to be good news for mortgage rates, with mortgage rates pulling back after posting increases for three consecutive weeks," the company said. "Mortgage rates remain within the narrow band of approximately one-tenth of a percentage point seen since mid-May."

Reports were mixed for average adjustable rates. According to Freddie Mac, the average rate for a 5-year adjustable-rate mortgage (ARM) was 3.08 percent (0.4 point) this week, up from 3.06 percent previously, while the 1-year ARM was unchanged at 2.43 percent (0.4 point).

Bankrate, meanwhile, put the 5/1 ARM average at 3.32 percent, down from 3.35 percent last week.