Mortgage rates start year near historic lows
The nation's average mortgage interest rates are starting 2012 near all-time historic lows amid signs of improvement in the housing market and manufacturing industry. The Freddie Mac mortgage market survey showed the 30-year, fixed-rate mortgage averaged 3.91% for the week ending Thursday, down from the prior week's average of 3.95%. Last year at this time, the 30-year FRM averaged 4.77%. This week's 15-year FRM, a popular refinancing choice, averaged 3.23%, down from last week when it averaged 3.24%. A year ago, the average rate for a 15-year FRM was 4.13%. Five-year, Treasury-indexed hybrid adjustable-rate mortgages averaged 2.86% this week, down slightly from 2.88% the prior week and lower than 3.75% a year earlier. And one-year Treasury-indexed ARMs averaged 2.8%, barely rising from last week when it averaged 2.78% but down from 3.24% last year. “Fixed mortgage rates started the year a little lower this week just as recent data reports indicate the housing market and manufacturing industry are showing signs of improvement ," said Frank Nothaft, vice president and chief economist at Freddie Mac. Nothaft cited that pending existing home sales in November jumped 7.3%, nearly five times greater than the market consensus forecast, to its strongest pace since April 2010. He then noted that construction spending rose 1.2% in November, supported by the residential sector, which exhibited its fourth consecutive monthly increase. Similarly, manufacturing expanded in December at the fastest pace in six months. Home loan analytics firm Bankrate reported the 30-year, FRM declined to 4.18% from 4.21%, while the 15-year, FRM fell to 3.4% from 3.44%, and the 5/1 ARM fell to 3.19% from 3.2%. Write to Justin T. Hilley. Follow him on Twitter @JustinHilley.