The national average interest rate for 30-year fixed home loans dipped to 4.87 percent for the week ending March 3, down from 4.95 percent the previous period, while 15-year loans fell to 4.15 percent from 4.22 percent, according to the latest statistics from the mortgage-backing giant Freddie Mac. It was the third consecutive week of declines for 30-year mortgages.
These declines were also down from the rates observed in the same week last year, the report said. In the first week of March 2010, rates on 30-year fixed loans were listed at 4.95 percent, and those for 15-year mortgages were 4.33 percent.
[Free Tool: Obtain your Identity Risk Score from Credit.com]
“Mortgage rates saw an overall improvement this week. Interest rates for 30-year fixed mortgages were almost 0.2 percentage points below this year’s high set just three weeks ago,” said Frank Nothaft, vice president and chief economist for Freddie Mac. “This means that homebuyers could now expect to pay $263 less per year on a $200,000 loan. However, housing demand still remains weak. New home sales in January were near record lows dating back to 1963 when the data began, according to the Census Bureau.”
Nothaft added that pending home sales, which is tracked by the National Association of Realtors, dropped for the second consecutive month in February as well, the report said.
Lower rates typically spur interest in home loans in general, but improvements will more often lead to an increase in the amount of refinances consumers seek.