May 5th, 2011 12:44 PM by Uletas Greene Carter
Interest rates on home loans have dropped across the board for the third consecutive week.
According to Freddie Mac's weekly market survey, rates on 30-year fixed mortgages averaged 4.71 percent (0.7 point) for the week ending May 5, 2011. That's down from 4.78 percent last week. However, last year at this time, the 30-year-rate was 5.00 percent.
The GSE's latest study puts the 15-year fixed-mortgage rate at 3.89 percent (0.7). Last week it was reported to be averaging 3.97 percent, and a year ago it was 4.36.
Adjustable-rate mortgages (ARMs) also headed lower this week. The 5-year ARM came in at 3.47 percent (0.6 point), down from 3.51 percent last week. The 1-year AR is now averaging 3.14 percent (0.5 point), down from last week's 3.15 percent.
Freddie Mac's chief economist, Frank Nothaft said "weaker economic data reports reduced Treasury bond yields and allowed mortgage rates to drift lower for the third consecutive week."
Nothaft explained, "For instance, real economic growth in the first quarter fell short of the market consensus forecast and represented the slowest pace since the second quarter of 2010. In addition, both the manufacturing and service sectors exhibited growth at a slower rate in April."
He says data reports on the housing market, on the other hand, were a little more uplifting, pointing out that the National Association of Realtors reported pending home sales rose in March for the second month in a row to the highest index reading since November 2010.
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