Fixed mortgage rates declined to their lowest levels since May of this year due to ongoing global volatility out of China, Freddie Mac’s Primary Mortgage Market Survey.
The 30-year fixed-rate mortgage averaged 3.84%, for the week ending Aug. 27, 2015, down from last week when it averaged 3.93 %. A year ago at this time, it averaged 4.10%.
Also dropping, the 15-year FRM this week averaged 3.06%, down from last week’s 3.15%. In 2014, the 15-year FRM averaged 3.25%.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 2.90% this week, down from last week when it averaged 2.94%. A year ago, the 5-year ARM averaged 2.97%.
The 1-year Treasury-indexed ARM averaged 2.62% this week, unchanged from last week. At this time last year, the 1-year ARM averaged 2.39%.
“Events in China generated eye-catching volatility in equity markets worldwide over the past week. Interest rates also rocked up and down—although to a lesser extent than equities—as investors alternated between flights to quality and bargain hunting among beaten-down stocks,” Sean Becketti, chief economist, Freddie Mac.
“Amidst all this confusion, the 30-year mortgage rate dropped to 3.84 percent, the lowest mark since May and the fifth consecutive week with a rate below 4%,” Sean Becketti, chief economist, Freddie Mac,” he added.
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(Source: Freddie Mac)
Meanwhile, the bond and stock market did get a brief lift after Black Monday thanks to recent public comments from New York Fed President William Dudley. On Wednesday, Dudley told press that the prospect of a September rate hike "seems less compelling" than it was only weeks ago.
However he warned about overreacting to "short-term" market moves, and left the door ajar to raising rates when the U.S. central bank holds a policy meeting on Sept. 16-17.