The 30 year mortgage rate ends six-week ascent but is still close to record highs.
Current mortgage rates finally tumbled after their six-week climb, but Freddie Mac said they remain close to levels not seen in more than a decade.
Freddie’s latest survey showed that the average 30-year fixed-rate mortgage retreated four basis points from last week to 6.66% as of October 6. The popular home loan rate stood at 2.99% a year ago and now hovers near 15-year highs.
The 15-year fixed mortgage rate also posted a modest decline this week, down to 5.90% from 5.96% the previous week. The average 15-year rate was only 2.23% a year ago. Meanwhile, the five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 5.36%, up from 5.30% the week before and from 2.52% a year ago.
“Mortgage rates decreased slightly this week due to ongoing economic uncertainty,” said Sam Khater, chief economist of Freddie Mac. “However, rates remain quite high compared to just one year ago, meaning housing continues to be more expensive for potential homebuyers.”
As interest rates continue to spiral, mortgage loan applications plummeted 14.2% to their slowest pace since 1997, according to the Mortgage Bankers Association.
“The current rate has more than doubled over the past year and has increased 130 basis points in the past seven weeks alone,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “The steep increase in rates continued to halt refinance activity and is also impacting purchase applications, which have fallen 37% behind last year’s pace.”