Mortgage rates continued to fall back toward the 5 percent mark this week despite the upward trend seen in mid-January and into February. The average mortgage interest rate on 30-year fixed-rate mortgages (FRMs) was 5.04 percent with an average 0.7 point for the week ending Feb. 19, down from 5.16 percent the week before, according to a survey released Thursday by Freddie Mac (FRE). The average rate for 15-year FRMs came in at 4.68 with an average 0.6 point, down from 4.81 the week before. Adjustable-rate mortgages (ARMs) also fell in the week; five-year Treasury-indexed hybrid ARMs averaged 5.04 percent with an average 0.6 point, down from 5.23 the week before. One-year Treasury-indexed ARMs averaged 4.8 percent with an average 0.5 point, down from 4.94 percent a week earlier. “Mortgage rates followed bond yields lower this week as recent economic reports suggest the economy is still slowing, which reduces the future threat of inflation,” said Freddie vice president and chief economist Frank Nothaft. A separate survey reported Wednesday on found that many rates slid in the same week. Though the average 30-year FRM held at 5.34 percent, as calculated by Bankrate, 15-year FRMs averaged 4.93 percent, 10 basis points (a basis point is one-hundredth of a percentage point) below the week-ago level. The average jumbo 30-year fixed fell 6 basis points to 6.92 percent in the week, while one-year ARMs slid slightly and five-year ARMs remained unchanged. Raw application activity jumped almost 46 percent for the week ending Feb. 13, according to a survey released Wednesday by the Mortgage Bankers Association, suggesting household response to lower mortgage rates drew more applications than the week before. Much of this application activity, however -- 74.2 percent -- was refinance. The data show people are trying harder to refinance under rates that hover at historically low levels, while the demand for new houses may not have improved much. Housing starts dropped 16.8 percent from the previous month to a seasonally-adjusted annual rate of 466,000 in January, according to data published Wednesday by the U.S. Commerce Department. Starts are down 56.2 percent for the year since January 2008. Building permits fell 4.8 percent for the month to a seasonally-adjusted 521,000 rate, according to the data. Write to Diana Golobay at Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.