WASHINGTON – Rates on 30-year and 15-year mortgages dipped this week, a development that should help keep the housing market humming.
Rates on 30-year, fixed-rate mortgages averaged 5.74 percent for the week ending Nov. 18, Freddie Mac said in its weekly survey released Thursday. That was down from 5.76 percent last week.
Rates on 30-year mortgages hit a high this year of 6.34 percent the week of May 13. After that, rates, while bouncing around, drifted lower.
“Because long-term mortgage rates are still well below the peak levels reached last May of this year, housing starts are currently exceeding expectations,” said Frank Nothaft, Freddie Mac’s chief economist.
Housing construction jumped 6.4 percent in October from the previous month to a seasonally adjusted annual rate of 2.03 million units – the highest level of this year, the Commerce Department reported on Wednesday.
“With no dramatic rise in rates on the horizon, the housing industry should continue to be healthy well into the future,” Nothaft predicted.
For 15-year, fixed-rate mortgages, a popular option for refinancing, rates this week averaged 5.15 percent, down slightly from 5.16 percent last week.
For one-year adjustable rate mortgages, rates increased a bit to 4.17 percent this week, compared with 4.16 percent last week.
Rates on one-year ARMs had risen sharply in the prior week, a development that was related to the Federal Reserve’s decision on Nov. 10 to boost a key short-term rate by one-quarter percentage point to 2 percent.
The nationwide averages for mortgage rates do not include add-on fees known as points. Thirty-year and 15-year mortgages each carried a 0.6 point fee. One-year ARMS carried a 0.7 point fee.
Low mortgage rates have aided the housing market, which is expected to set record-high sales for all of 2004.
A year ago, rates on 30-year mortgages averaged 6.03 percent with 15-year mortgages at 5.39 percent and one-year ARMs at 3.76 percent.
Rebecca Ryan has joined the Mukilteo office of Windermere Real Estate as a sales associate.
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