U.S. mortgage rates dropped to the lowest level in six weeks, reducing borrowing costs for homebuyers as the housing market languishes.
The average 30-year rate fell to 4.78 percent in the week ended today from 4.80 percent, Freddie Mac said in a statement. The 15-year rate averaged 3.97 percent, down from 4.02 percent a week ago, the McLean, Virginia-based mortgage-finance company said. Both rates were the lowest since the week ended March 17.
Mortgage rates of less than 5 percent have done little to increase demand for home purchases as unemployment remains close to 9 percent. The S&P/Case-Shiller index of property values in 20 cities fell 3.3 percent in February, the largest year-over-year decline since November 2009, a report this week showed.
The Mortgage Bankers Association’s index of loan applications declined 5.6 percent in the week ended April 22, the Washington-based group said yesterday. Its gauge of purchases plunged 14 percent, the most in almost a year. The index measuring refinancing dropped 0.6 percent.
The average rate for a 30-year fixed loan is below where it was last year at this time, when it was 5.06 percent, according to Freddie Mac. It hit a record low of 4.17 percent in November.