Mortgage rates in the U.S. fell, decreasing borrowing costs as the housing market moves into its second year of recovery.
The average rate for a 30-year fixed mortgage was 3.54 percent in the week ended today, down from 3.57 percent, McLean, Virginia-based Freddie Mac said in a statement. The average 15-year rate slipped to 2.74 percent from 2.76 percent.
U.S. home prices rose 10.2 percent in February from a year earlier, the most since March 2006, Irvine, California-based CoreLogic Inc. said yesterday. It was the 12th consecutive month of year-over-year gains as low borrowing costs drove demand for a thin supply of homes.
“The house-price rebound shows no sign of spluttering out,” Paul Diggle, property economist for Capital Economics in London, wrote in a note to clients after CoreLogic’s data were released. “Nor should it. After all, supply conditions are still very tight.”
The inventory of homes for sale rose in February after dropping to a 12-year low in the previous month, according to the National Association of Realtors.
The Mortgage Bankers Association’s index of home-loan applications dropped 4 percent in the period ended March 29 after a 7.7 percent gain the prior week. The refinance gauge fell 5.6 percent, while the purchase index rose 1.4 percent, the Washington-based group reported yesterday.