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Mortgage rates sink to lowest levels in more than a year | TribLIVE.com
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Mortgage rates sink to lowest levels in more than a year

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The Washington Post
The 30-year fixed-rate average fell to 4.31 percent and hasn’t been this low since February 2018.

Mortgage rates were driven down this week by weak economic data and concerns about global growth.

According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average tumbled to 4.31 percent with an average 0.4 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 4.41 percent a week ago and 4.44 percent a year ago. The 30-year fixed rate hasn’t been this low in more than a year.

The 15-year fixed-rate average dropped to 3.76 percent with an average 0.4 point. It was 3.83 percent a week ago and 3.90 percent a year ago. The five-year adjustable rate average slipped to 3.84 percent with an average 0.3 point. It was 3.87 percent a week ago and 3.67 percent a year ago.

Last week’s disappointing employment report began a cascade of discouraging economic news. Consumer price levels increased in February but fell short of analysts’ expectations. The European Central Bank downgraded growth and inflation for the coming year. Britain and the European Union failed to reach an agreement on Brexit.

Dampened growth expectations boosted the demand for safer assets such as bonds. The yield on the 10-year Treasury sank to its lowest level since early January, falling to 2.61 percent Tuesday and holding there on Wednesday. The movement of long-term bonds tends to be a good indicator of where mortgage rates are headed. When yields fall, home loan rates often follow.

“Rates retreated this week as markets continue to grapple with an uncertain economic outlook,” said Matthew Speakman, Zillow economic analyst.

Because investors will probably be waiting to see what comes out of next week’s Federal Reserve meeting, mortgage rates aren’t expected to move much in the coming week. Bankrate.com, which puts out a weekly mortgage rate trend index, found that three-quarters of the experts it surveyed say rates will remain relatively stable in the coming week. Jim Sahnger, mortgage planner at C2 Financial, is one who predicts rates won’t change.

“We saw a little bump down in rates from last week, following a disappointing read on the employment report where job growth stalled and favorable reads on inflation numbers,” Sahnger said. “We do have a Fed meeting next week and all eyes and ears will await the statement. Look for dovish comments based on the global outlook for growth. Rates should stay tight going into the meeting and we’ll see where they head after it.”

Meanwhile, falling rates helped juice mortgage applications, according to the latest data from the Mortgage Bankers Association. The market composite index – a measure of total loan application volume – increased 2.3 percent from a week earlier. The refinance index slipped 0.2 percent from the previous week, while the purchase index grew 4 percent.

The refinance share of mortgage activity accounted for 38.6 percent of all applications.

“Purchase applications jumped 4 percent last week and were 2 percent higher than a year ago, as improving inventory levels and easing affordability conditions continue to lead to more success for prospective homebuyers,” said Bob Broeksmit, MBA president and CEO. “Along with the healthy labor market, the steady decline in mortgage rates so far in 2019 — now at levels not seen since February 2018 — is setting the stage for what we expect to be a solid spring buying season. Purchase activity has now increased year-over-year for four straight weeks.”

Categories: Business | Wire stories
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