ARM Rate Hits Record Low

The average one-year ARM rate hit a record low for the week ending Dec. 20 as the average 30-year fixed mortgage rate fell slightly to 6.03% from 6.04% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate fell from 5.46% to 5.42%, while the average rate for one-year Treasury-indexed adjustable-rate mortgages dropped from 4.18% to 4.07%, its lowest level since Freddie Mac started tracking it in 1984. Fees and points averaged 0.6 points for all three mortgage categories. "It was no great surprise that housing starts rose for the second time in three months, since mortgage rates in November reached levels not seen since the mid-1960s," said Frank Nothaft, Freddie Mac's chief economist. "Since mortgage rates are not expected to increase significantly, we remain confident that the housing industry will continue to be alive and active well into 2003." A year ago, the average 30-year and 15-year fixed rates were 7.17% and 6.65%, respectively, and the average one-year ARM rate was 5.27%, Freddie Mac said. Freddie Mac can be found on the Web at http://www.freddiemac.com.