Fixed-rate mortgages fall for fifth straight week
Fixed-rate mortgages fell for the fifth consecutive week as the financial markets try to anticipate where the economy is heading, according to the Freddie Mac weekly survey. The 30-year, fixed-rate mortgage averaged 4.61% with an average 0.7 point for the week ending May 19, down from 4.63% last week. One year ago, the 30-year FRM averaged 4.84%. The 15-year FRM averaged 3.8% with an average 0.7 point, down from 3.82% one week ago. Last year, it averaged 4.24%. The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.48% at 0.6 point, up from 3.41%. The one-year Treasury-indexed ARM averaged 3.15% with an average 0.6 point. "Fixed mortgage rates inched down for the fifth consecutive week as financial markets try to ascertain the current strength of the economy," said Freddie's Chief Economist Frank Nothaft. Industrial production was unchanged, disrupting automobile parts supplies from the earthquake and tsunami in Japan. Retail sales were up, and although they offset high gasoline prices and auto industry struggles, it was the smallest growth since December 2010. Consumer confidence levels, however, rose above the market census in May to the highest reading since February. Mixed data continued in the housing market. New construction on single-family homes fell, keeping homebuilder confidence pessimistic. However, applications for new mortgages increased each of the past five weeks buoyed by these low rates and stronger refinancing activity, Nothaft said. Fixed-rate mortgages sipped on the survey conducted by Bankrate as well. It said the 30-year FRM fell to the lowest rate in more than five months to 4.77%. The lower rates surprised many experts anticipating an increase as the U.S. passed its $14.3 trillion debt ceiling, Bankrate said, adding if the ceiling isn't raised in August, rates will almost certainly spike. Write to Jon Prior. Follow him on Twitter @JonAPrior.