The average rate on 15-year fixed-rate mortgages dipped to 3.10 per cent from 3.19 per cent.
On Wall Street Wednesday, stocks tumbled as the price of oil suffered its worst one-day drop since September. The Dow Jones industrial average dropped more than 500 points during the day. The market clawed back much of the decline but still ended sharply lower with a loss of 249.28 points, or 1.6 per cent.
The continuing tumult in stock markets around the world has pushed up prices of U.S. government bonds as investors seek safety. That has depressed the yields on the bonds, which mortgage rates track.
The yield on the 10-year Treasury bond dropped to 1.98 per cent Wednesday _ its lowest level since October _ from 2.09 per cent a week earlier. The yield slipped further to 1.97 per cent Thursday morning.
The benchmark yield has fallen sharply since the start of the year amid the stock market turbulence. At the end of 2015, it stood at 2.30 per cent.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 per cent of the loan amount.
The average fee for a 30-year mortgage was unchanged from last week at 0.6 point. The fee for a 15-year loan remained at 0.5 point.
The average rate on five-year adjustable-rate mortgages dipped to 2.91 per cent from 3.01 per cent; the fee rose to 0.5 point from 0.4 point.
Mortgage buyer Freddie Mac said Thursday the average rate on a 30-year fixed-rate mortgage declined to 3.81 per cent from 3.92 per cent a week earlier. That was its lowest level in three months. The rate has increased from its 3.63 per cent average a year ago but remains well below its historic average of 6 per cent.