Another Week of Near Record Low Mortgage Rates

The record low for the 30-year fixed rate mortgage hit 3.94% nine weeks ago. This week the rate ticked down to 3.99% from 4% last week. These numbers are according to the National Bureau of Economic Research. The average rate for a 15-year fixed mortgage edged down from 3.30% to 3.27%. Its lowest level was also nine weeks before at 3.26%.

Mortgage rates usually follow the yield on the 10-year Treasury note. That yield rose this week. Investors were encouraged by central banks’ joint effort to ease lending standards. This buoyed investor attitude translated into movement of money from the Treasuries into stocks. When buying of Treasuries declines, the yields rise.

For all but two weeks in 2011, mortgage interest rates have been below 5%. However, these super low rates haven’t provided any relief for the depressed housing market. This year is set to be the worst for home sales in 14 years. According to the Mortgage Bankers Association, mortgage applications rose by 13% last month, but that was up from dismally low levels.

Few people can qualify for mortgages these days, and even refinancing loans are beginning to wither, as the extended period of low rates has resulted in most of those who can qualify to refinance having already done so.