The average rate for a 30-year fixed-rate mortgage fell from last week’s 3.71% to 3.59%, matching a level not seen since February of 2015, according to Freddie Mac. The 15-year rate also dropped, sliding from 2.98% to 2.88%.
“Mortgage rates this week registered the delayed impact of last week's sharp drop in Treasury yields as the 30-year mortgage rate fell 12 basis points to 3.59 percent,” said Sean Becketti, chief economist at Freddie Mac. “This rate marks a new low for 2016 and matches last year's low in February 2015. Low mortgage rates and a positive employment outlook should support a strong housing market in the second quarter of 2016.”
Lower rates are good news as the spring home buying season gets underway. Low borrowing costs will help increase demand for an already short supply of homes, Keith Gumbinger, vice president at mortgage data company HSH.com, told Bloomberg. But it could also have the effect of goosing already high prices even further upward.
“To the extent they incentivize more wannabe homebuyers into the marketplace, that only puts more upward pressure on prices,” he said.
Mortgage rates have fallen to their lowest levels in 14 months, according to new data from Freddie Mac.