Freddie Mac lowers forecast for long-term borrowing costs

Thursday, June 09, 2005

Inman News

Mortgage rates fell for the fourth consecutive week on news of disappointing job gains, according to Freddie Mac's weekly mortgage survey.

Freddie Mac reported that the 30-year fixed-rate mortgage averaged 5.56 percent, with an average 0.6 point, for the week ended today, down from last week when it averaged 5.62 percent. The 30-year fixed-rate mortgage has not been this low since April 1, 2004, when it averaged 5.52 percent.

The average for the 15-year fixed-rate mortgage this week is 5.14 percent, with an average 0.5 point, also down from last week when it averaged 5.2 percent.

Five-Year Treasury-indexed hybrid adjustable-rate mortgages averaged 5.01 percent this week, with an average 0.5 point, down from last week when they averaged 5.07 percent. One-year Treasury-indexed adjustable-rate mortgages averaged 4.21 percent this week, with an average 0.7 point, down from last week when it averaged 4.26 percent.

“Taking into consideration the fact that mortgage rates have fallen from the earlier peak at the end of March, we have lowered our forecast for long-term rates. We now expect that the 30-year fixed-rate mortgage rates will likely end up somewhere between 5.9 percent and 6.2 percent by the end of this year.”

The following is a sampling of Bankrate's average 30-year-mortgage interest rates this week in some U.S. metropolitan areas.

New York - 5.58 percent with 0.23 point

Los Angeles - 5.62 percent with 0.5 point

Chicago - 5.75 percent with no points

San Francisco - 5.65 percent with 0.24 point

Philadelphia - 5.5 percent with 0.35 point

Detroit - 5.61 percent with 0.27 point

Boston - 5.66 percent with 0.1 point

Houston - 5.57 percent with 0.6 point

Dallas - 5.65 percent with 0.44 point

Washington, D.C. - 5.5 percent with 0.44 point

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