Mortgage rates dipped for a second week in a row this week following comments from Federal Reserve Chairman Ben Bernanke that the Fed might not start curtailing its bond-buying program in the fourth quarter after all.
According to government-sponsored enterprise Freddie Mac's Primary Mortgage Market Survey for the week ending July 25, the average rate for 30-year fixed rate mortgages dipped to 4.31% this week, a drop of 0.8 basis points from last week's 4.37%.
Last year at this time, the 30-year fixed-rate mortgage averaged 3.49%.
The average rate for a 15-year fixed-rate mortgage fell to 3.39%, a decrease of 0.8 basis points compared to last week, when it averaged 3.41%.
A year ago at this time, the 15-year fixed-rate mortgage averaged 2.8%.
The average rate for five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) fell to 3.16%, a drop of 0.7 basis points from last week's 3.17%.
A year ago, the five-year ARM averaged 2.74%.
The average rate for one-year Treasury-indexed ARMs was 2.65% this week, a drop of 0.4 basis points compared to last week, when they averaged 2.66%.
At this time last year, the one-year ARM averaged 2.71%.
‘Mortgage rates eased for the second consecutive week, which should help to alleviate market concerns of a slowdown in the housing market,’ said Frank Nothaft, vice president and chief economist for Freddie Mac, in a statement. ‘Thus far, existing home sales for June were the second highest since November 2009, and new home sales were the strongest since May 2008. In addition, the low inventories of homes for purchase are putting upward pressure on house prices. For instance, the FHFA purchase-only house price index increased for the 16th consecutive month in May and was 7.3 percent above the May 2012 figure; May's index level was the highest since September 2008.’