U.S. Mortgage Rates Remain Below Four Percent for Three Straight Months

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Based on Freddie Mac's latest Primary Mortgage Market Survey (PMMS), the average fixed mortgage rate nudging slightly higher throughout the beginning of the week. However, Fed comments suggesting it may not raise short-term interest rates yesterday, coupled with weaker than expected consumer demand, pushed Treasury yields lower suggesting interest rates may remain lower than reported a while longer.

Sean Becketti, chief economist of Freddie Mac stated, "As the shock of the weak September employment report wore off, Treasury rates drifted higher. In response, the 30-year mortgage rate climbed 6 basis points to 3.82 percent, marking 12 consecutive weeks below 4 percent. Late-breaking news suggests mortgage rates may remain in this territory a while longer. After this week's survey closed, Federal Reserve Governor Daniel Tarullo was quoted suggesting the Fed may not act this year, and Wednesday the 10-year Treasury closed under 2 percent in reaction to economic releases indicating weak consumer demand."
 
Freddie Mac News Facts

• 30-year fixed-rate mortgage (FRM) averaged 3.82 percent with an average 0.6 point for the week ending October 15, 2015, up from last week when it averaged 3.76 percent. A year ago at this time, the 30-year FRM averaged 3.97 percent.

• 15-year FRM this week averaged 3.03 percent with an average 0.6 point, up from last week when it averaged 2.99 percent. A year ago at this time, the 15-year FRM averaged 3.18 percent.

• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.88 percent this week with an average 0.4 point, unchanged from last week. A year ago, the 5-year ARM averaged 2.92 percent.

• 1-year Treasury-indexed ARM averaged 2.54 percent this week with an average 0.2 point, down from 2.55 percent last week. At this time last year, the 1-year ARM averaged 2.38 percent.