ICS Magazine

US 30-, 15-yr mortgage rates at new record lows

September 5, 2002
WASHINGTON, Sept 5 (Reuters) - U.S. 30- and 15-year fixed-rate mortgages fell to new lows in the week ending Sept. 6 as stock market rallies pushed bond yields upward and suppressed interest rates, Freddie Mac said on Thursday.

Thirty-year mortgage rates stood at an average 6.15 percent -- the lowest on Freddie Mac's records which they have been keeping since 1971 -- compared with 6.22 percent last week. Fifteen-year mortgages also fell to a record low of 5.56 percent from 5.64 percent the prior week.

One-year adjustable rate mortgages (ARM) stood at an average 4.35 percent, little changed from 4.34 percent last week.

A year ago, 30-year mortgages averaged 6.89 percent, 15-year mortgages 6.44 percent and the ARM 5.64 percent.

"Looking for safety from the current uneasiness in domestic and foreign markets, nervous investors pumped their money into the U.S. Treasury bond market, causing yields to fall to record levels," Frank Nothaft, Freddie Mac chief economist, said in a statement.

"Housing appreciation continues to outpace inflation and mortgage rates are at the lowest levels in more than a generation," Nothaft said. "These factors combine (to) make homeownership even more attractive and affordable."

On Wednesday the Commerce Department said in its monthly U.S. construction spending report that single-family home building rose to a $262.6 billion level in July, up 0.4 percent from the prior month.