For consumers looking to make a big investment in 2013, purchasing a home may be an affordable option. Despite small fluctuations throughout the first two months of the year, Freddie Mac's Primary Mortgage Market Survey for the week ending March 7 revealed average rates were, for the most part, unchanged and continued to linger near record low levels set in November 2012.
According to real estate records, the average rate for 30-year fixed-rate mortgages rose on a week-over-week basis to 3.52 percent from 3.51 percent. This time a year ago, the average rate was 3.88 percent, indicating this mortgage option offers affordability for those who desire homeownership.
While 30-year FRMs saw a weekly gain, the average rate for 15-year FRMs remained at 2.76 percent, matching the level from the week before. This time last year, the average was 3.13 percent, a much more affordable rate for prospective buyers and current homeowners looking to refinance their initial mortgage.
The average rate for 5-year adjustable-rate mortgages improved slightly to 2.63 percent from 2.61 percent recorded the previous week. This is a step closer toward the 2.81 percent average rate recorded this time last year. ARMs have been a less demanded mortgage option, as averages have been continuously growing near rates seen in recent years.
The only mortgage option that posted a week-over-week decline was 1-year ARMs, which posted an average of 2.63 percent from 2.64 percent seen the week before. This time last year, the average rate was 2.73 percent.
The vice president and chief economist of Freddie Mac, Frank Nothaft, highlighted that low mortgage rates have prevailed while other housing market factors have been posting significant improvements.
"With gross domestic product growing only 0.1 percent in the fourth quarter of 2012, inflation remains at bay and consequently mortgage rates low," said Nothaft. "In fact, the price index of personal consumption expenditures rose only 0.1 percent in January which was below the market consensus forecast. Moreover, these low mortgage rates are helping to revive the housing market. For instance the CoreLogic home price index rose 9.7 percent between January 2012 and 2013, marking the largest annual increase since April 2006."