30-Year Rate Nears 7-Month Low

The average 30-year fixed mortgage rate fell to 6.91% for the week ending Aug. 14 from 6.94% the week before, according to Freddie Mac's Primary Mortgage Market Survey.The last time the rate was lower was the week ended Jan. 16, 1998 when it reached 6.89%, although the same rate of 6.91% was hit during the week ended July 10. The average 15-year fixed mortgage rate dipped to 6.60% from 6.63% the previous week, and the average rate for one-year Treasury-indexed adjustable-rate mortgages drifted down to 5.60% from 5.61%. Fees and points averaged 1.1 for all three categories. "Falling interest rates are largely the result of events in Asia," said Robert Van Order, Freddie Mac's chief economist. "Concern over other currencies and a fear of devaluation lead people to invest money into more stable currencies such as U.S. dollars. This causes bond prices to go up and interest rates to go down. In the months to come, although it will slow down, the housing market will remain strong, as will the overall economy." A year ago, the average 30-year and 15-year fixed rates were 7.54% and 7.07%, respectively, and the average one-year ARM rate was 5.56%. Freddie Mac's website address is http://www.freddiemac.com.