Mortgage rates in the U.S. fell for a seventh week, the longest decline since September, tracking a drop in Treasury yields as signs of a slowing economy drove demand for relatively safe investments.
The average rate for a 30-year loan slipped to 4.55 percent in the week ended today from 4.60 percent, according to Freddie Mac. That is the lowest since the week ended Dec. 2. The 15-year rate fell to 3.74 percent from 3.78 percent a week ago, the McLean, Virginia-based mortgage-finance company said.
Yields on 10-year Treasury notes, which are benchmarks for some consumer loans, declined yesterday to the lowest level since December, after reports showing hiring and manufacturing growth cooled. Companies in the U.S. added 38,000 workers in May, fewer than forecast and the smallest jump in since September, ADP Employer Services said yesterday. Manufacturing grew at the slowest pace in more than a year, according to the Institute for Supply Management’s factory index.
The housing market is struggling under pressure from 9 percent unemployment, strict lending standards and mounting foreclosures. The S&P/Case-Shiller index of property values in 20 cities dropped 3.6 percent in March from a year earlier, the biggest year-over-year decline since November 2009, the group said May 31. The index measuring contracts to buy previously owned homes fell 12 percent in April, according to the National Association of Realtors.
Mortgage applications decreased 4 percent in the week ended May 27, the first drop in five weeks, according to the Mortgage Bankers Association. The Washington-based group’s measure of refinancing fell 5.7 percent while its purchasing gauge was unchanged.
The average rate for a 30-year fixed loan is below where it was last year at this time, when it was 4.79 percent, according to Freddie Mac. It fell to a record 4.17 percent in November.