The 30-year fixed-rate mortgage (FRM) is down to 4.51 percent (with an average 0.7 point) this week and 15-year rates dropped to 3.65 percent (with an average 0.6 point), according to MarketWatch. While neither drop is incredibly drastic, it is believed that the falling rates may be connected with weak job gains and rising unemployment ratesA year ago, the 30-year FRM was at 4.57 percent, and the 15-year rate was marked at 4.06 percent.
In the first week of July, mortgage rates and applications were climbing upward, with a 30-year FRM of 4.6 percent and 15-year FRM of 3.75 percent.
“Long-term bond yields and mortgage rates fell this week following a weak employment report. The economy added 18,000 jobs in June, well below the market consensus forecast, and the unemployment rate rose to 9.2 percent, the highest since December 2010. In addition, employee wages stagnated. These factors may lead to less consumer spending, which in turn, reduces the threat of inflation in the near term,” said Frank Nothaft, vice president and chief economist of Freddie Mac in a news release yesterday.
The 5-year Treasury-indexed hybrid adjustable rate-mortgage (ARM) averaged 3.29 percent (with an average 0.6 point) this week, and 1-year ARM slid down to 2.95 percent.
Last week, the 5-year ARM was 3.30 percent and the 1-year was 3.01 percent; last year, the 5-year ARM was 3.85 percent on average, and the 1-year ARM was 3.74 percent.
MarketWatch added that foreclosure activity is also down 29 percent in the first half of the year
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