Mortgage Rates Fall for Second Week as Home Sales Rebound
Mortgage rates fell for a second week, lowering borrowing costs as the housing recovery gets a second wind.
The average rate for a 30-year fixed mortgage was 4.14 percent this week, down from 4.17 percent, Freddie Mac said in a statement today. The average 15-year rate declined to 3.22 percent from 3.3 percent, according to the McLean, Virginia- based mortgage-finance company.
The housing market, hurt by unusually harsh winter weather in much of the country, is now gaining strength as employment and consumer confidence improves. New-home sales jumped 18.6 percent in May from the previous month to a six-year high, the Commerce Department said this week. Existing-home sales rose 4.9 percent, the biggest increase since August 2011, according to the National Association of Realtors.
"There's a ton of interested buyers," Paul Anastos, president of Mortgage Master Inc., a Walpole, Massachusetts- based lender, said in a telephone interview yesterday. "Interest rates are still near historic lows so the buying power of the consumer is strong."
Mortgage rates are below where they were one year ago, when they started to spike after the Federal Reserve signaled it may start winding down its unprecedented stimulus plan. The average rate for a 30-year loan this week last year was 4.46 percent, according to Freddie Mac.