Mortgage Rates Fall With Home Demand By Joan E. Solsmman Wall Street Journal 03-05-2010

Mortgage Rates Fall With Home Demand
By Joan E. Solsmman
The Wall Street Journal
March 05, 2010

Mortgage rates generally declined this week, with the average rate on 30-year fixed-rate mortgages retreating below 5%, according to Freddie Mac's weekly survey of mortgage rates.

Demand for new and used homes strengthened last year, but has dropped in recent months because of cold weather and continuing joblessness. New-home sales unexpectedly hit a record low in January, the Commerce Department said last week, while existing-home sales slumped.

Treasury yields were generally flat in the past week; mortgage rates tend to follow the yields.

The 30-year fixed-rate mortgage averaged 4.97% for the week ended Thursday, down from last week's 5.05% average and 5.15% a year ago. Rates on 15-year fixed-rate mortgages were 4.33%, down from 4.4% last week and 4.72% a year ago.

Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 4.11%, lower than last week's 4.16% and last year's 5.08%. One-year Treasury-indexed ARMs were 4.27%, up from 4.15% last week but down from 4.86% a year earlier.