Mortgage rates in the U.S. were little changed, keeping borrowing costs at the record-low levels that have helped bolster the housing market.
The average rate for a 30-year fixed mortgage held in the week ended today at 3.66 percent, the lowest in Freddie Mac records dating to 1971. The average 15-year rate dropped to 2.94 percent, also a record, from 2.95 percent, the McLean, Virginia-based mortgage-finance company said today in a statement.
Low borrowing costs are helping to strengthen housing demand as property prices stabilize. Contracts to buy previously owned homes rose 5.9 percent last month, matching a two-year high reached in March, the National Association of Realtors said yesterday. The S&P/Case Shiller index of values in 20 U.S. cities dropped 1.9 percent in April from a year earlier, the smallest decline since November 2010.
“We’ve lifted off the bottom,” Ellen Zentner, a senior U.S. economist at Nomura Securities International Inc. in New York, said yesterday in a telephone interview. “We are in a housing recovery, not a very robust one, but we have seen the turning point for sales and activity, pretty much nationwide.”
Lennar Corp., the third-largest U.S. homebuilder by revenue, yesterday reported a surge in fiscal second-quarter profit as it booked a tax benefit and sales climbed. Orders jumped 40 percent from a year earlier, the Miami-based company said.
Purchases of new U.S. houses rose in May to a two-year high, the Commerce Department said June 25.
Home-loan applications declined in the period ended June 22, according to the Mortgage Bankers Association. A measure of refinancing dropped 8.3 percent from the prior week, while the purchase gauge fell 1.4 percent, the Washington-based group said yesterday.