Mortgage rates finished the year below 4%, which is a whole percentage point down from what was predicted for this time of year, Freddie Mac’s latest primary mortgage market survey found.

The 30-year, fixed-rate mortgage averaged 3.87% for the week ended Dec. 31, up from last week’s 3.83%. In 2013, it averaged 4.53%. 

In addition, the 15-year, fixed-rate mortgage increased from 3.10% a week ago to 3.15%. A year ago, it sat at 3.55%.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage stayed unchanged at 3.01%. But it is slightly down from last year’s 3.05%.

The 1-year Treasury-indexed ARM averaged 2.40%, increasing from 2.39% last week, but is down from 2.56% a year ago.

“While mortgage rates edged up this week, they remain near 2014 lows. Looking at full-year data, the 30-year fixed-rate average for 2014 was 4.17%, the highest annual average since 2011,” said Frank Nothaft, vice president and chief economist with Freddie Mac.

Bankrate posted that mortgage rates moved slightly higher for the second week, with the 30-year fixed rising to 3.99%, up from 3.96% last week.

The 15-year fixed increased 3.27%, up from 3.25% last week, while the 5/1 ARM grew to 3.32%, up from 3.28%.

“Despite forecasts for increases in 2014, mortgage rates fell throughout the year, with the benchmark 30-year fixed mortgage rate ending 2014 under the 4% threshold, at 3.99%. Even with average home price appreciation of 5%, housing is more affordable now, with lower monthly payments on a larger loan than one year ago, by virtue of lower mortgage rates,” Bankrate said in its mortgage report.  

“Yet the housing market is sluggish as would-be homebuyers contend with stagnant incomes. If wage growth materializes as expected in 2015, home sales will pick up as buyers' reluctance slips away,” Bankrate continued.