Homebuyers heading into the marketplace are still looking at historically low mortgage rates, Freddie Mac said in its Primary Mortgage Market Survey.
The 30-year, fixed-rate mortgage for the week ending Oct. 18 hit 3.37%, which is down from 3.39% a week earlier and from 4.11% last year.
The 15-year FRM reached a new all-time low of 2.66%, down from 2.7% a week ago and well under the 3.38% reported last year.
Homebuyers and refinancing borrowers with 5-year Treasury-indexed ARMs and 1-year Treasury ARMs, saw rates rise to 2.75% and 2.6%, respectively.
“Mortgage rates remained more or less unchanged this week as home construction builds up steam,” said Frank Nothaft, vice president and chief economist of Freddie Mac.
“Construction on single-family homes jumped to an annualized rate of 11% in August, the strongest pace since August 2008. Over the first nine months of the year, single-family starts were 23% higher than the same period last year. Moreover, homebuilder confidence rose for the sixth consecutive.”
The low rates come at a time when homebuilders are seeing more demand for their services. Housing starts increased 15% since August to an annual rate of 872,000 homes.
The Federal Reserve has remained committed to a low interest-rate environment and targeted mortgage rates with its recent decision to acquire mortgage-backed securities at the pace of $40 billion a month.
