Home buyers, along with homeowners looking to refinance their existing loans, are having it a bit easier lately as the 30-year fixed mortgage rate dropped for the fourth consecutive week and has reached its lowest level in nearly seven months.
The 30-year fixed rate fell to 3.89 percent this week, says Freddie Mac.
Since mortgage rates follow Treasury yields closely, investors opting for the safety of bonds have helped keep home loan rates below 4 percent. Treasury yields move in the opposite direction of bond prices — so the more demand for Treasuries, the lower the yield.
And what causes investors to turn to bonds? Primarily, it’s economic uncertainty.
“The 10-year Treasury yield fell 3 basis points this week,” said Sean Becketti, chief economist, Freddie Mac. “The 30-year mortgage rate moved in tandem with Treasury yields, falling 5 basis points to 3.89 percent. Mixed economic data and increasing uncertainty are continuing to push rates to the lowest levels in nearly seven months.”
Here is Freddie Mac’s overview of mortgage rates:
30-year fixed-rate mortgage (FRM) averaged 3.89 percent, with an average 0.5 point for the week ending June 8, 2017, down from last week when it averaged 3.94 percent. A year ago at this time, the 30-year FRM averaged 3.60 percent.
15-year FRM this week averaged 3.16 percent, with an average 0.5 point, down from last week when it averaged 3.19 percent. A year ago at this time, the 15-year FRM averaged 2.87 percent.
5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.11 percent this week, with an average 0.5 point, the same as last week. A year ago at this time, the 5-year ARM averaged 2.82 percent.