Mortgage rates for most U.S. home loans eased slightly for the third consecutive week to remain at a six-month low.
The average interest rate for a 30-yearfixed mortgage inched down to 4.20%, from 4.21% last week, according to the latest survey from mortgage buyer Freddie Mac. The popular loan averaged 3.51% a year ago.
“Mortgage rates were little changed amid a week of light economic reports,” Frank Nothaft, vice president and chief economist for Freddie Mac, said in a statement. “These lower-than-expected rates are welcome news with the spring home-buying season underway, and may even provide those who haven’t already refinanced possibly a reason to take another look. ”
The 15-year fixed-rate average also edged down this week to 3.29% from 3.32%. It averaged 2.69% a year earlier.
Averages for hybrid adjustable-rate mortgages were mixed. The five-year ARM is now trending at 3.01%, down from 3.05% a week ago. A year ago, it averaged 2.62%. The one-year ARM was unchanged from 2.43% a week ago. It averaged 2.55% at this time last year.
Rates rose toward the end of 2013 after the Federal Reserve announced it would begin to curb its bond-buying stimulus program. However, rates have eased about a quarter of a percentage point over concerns that the market is too weak to support a dramatic upward shift in home prices. The average interest rate on a 30-year fixed-rate mortgage in the first weeks of this year was around 4.5%.
Most analysts believe mortgage rates will remain flat in the short term. In the latest Mortgage Rate Trend Survey by Bankrate.com, 62% of the analysts polled believed rates will hold steady over the next week.
“Unless we have an unexpected surge in inflation, I’m not sure there is anything on the economic calendar in the coming week that is significant enough to push bond yields and mortgage rates higher,” said Greg McBride, chief financial analyst at Bankrate.com.