U.S Mortgages – Mortgage Rates Fall for a 4th Consecutive Week

Bob Mason

Updated Sat, May 25, 2019, 11:34 PM

Mortgage rates fell for a 4^th consecutive week in the week ending 23^rd May. 30-year fixed rates fell by 1 basis point following on from a 3 basis point fall from the previous week. The 1 basis point fall took 30-year rates to 4.06% according to figures released by Freddie Mac.

Following the weekly fall, 30-year fixed rates stood 60 basis points below levels from 12-months ago.

More significantly, 30-year fixed rates have fallen by 88 basis points since last November’s most recent peak of 4.94%.

Economic Data from the Week

Economic data through the first half of the week was on the lighter side. April existing home sales figures weighed on the Greenback on Tuesday.

Outside of the stats, the FOMC meeting minutes also provided direction on Wednesday. The minutes continued to reflect the FED’s intentions to hold on policy near term.

The lack of economic data left market sentiment towards the extended U.S – China trade war to pin back U.S Treasury yields on the week.

Freddie Mac Rates

The weekly average rates for new mortgages as of 23^rd May were quoted by Freddie Mac to be:

30-year fixed rates fell by 1 basis points to 4.06% in the week. Rates were down from 4.66% from a year ago. The average fee held steady at 0.5 points.

15-year fixed rates slipped by 2 basis points to 3.51% in the week. Rates were down from 4.15% from a year ago. The average fee remained unchanged at 0.4 points.

5-year fixed rates increased by 2 basis points to 3.68% in the week. Rates decreased by 19 basis points from last year’s 3.87%. The average fee held steady at 0.4 points.

According to Freddie Mac, the downward trend in mortgage rates supported purchase demand. More affluent consumers were reported to be more responsive to the downward trend in rates.

Mortgage Bankers’ Association Rates

For the week ending 17^th May, rates were quoted to be:

Average interest rates for 30-year fixed, backed by the FHA, increased from 4.32% to 4.34%. Points decreased from 0.49 to 0.47 (incl. origination fee) for 80% LTV loans.
Average interest rates for 30-year fixed with conforming loan balances decreased from 4.40% to 4.33%. Points increased from 0.40 to 0.43 (incl. origination fee) for 80% LTV loans.
Average 30-year rates for jumbo loan balances remained unchanged at 4.24%. Points increased from 0.27 to 0.35 (incl. origination fee) for 80% LTV loans.

Weekly figures released by the Mortgage Bankers Association showed that the Market Composite Index, which is a measure of mortgage loan application volume, increased by 2.4% in the week ending 17^th May. The increase reversed a 0.6% fall in the week ending 10th May.