The average rate on a 30-year fixed mortgage fell to 3.4 percent in the week ended April 25, according to Freddie Mac's weekly survey released Thursday, making refinancing and home-buying more attractive to those who can qualify.
The average rate on the 15-year fixed mortgage fell to 2.61 percent from 2.64 percent last week. That's below the previous record low of 2.63 percent in November, the lowest since the 1990s.
Mortgage rates are low because they tend to track the yield on the 10-year Treasury note, which has fallen in recent weeks. The Federal Reserve has been buying Treasury bonds since the fall. That has helped to lower the yield.
"The housing market is getting a boost with mortgage rates hovering at or near record lows," said Frank Nothaft, a vice president and chief economist at Freddie Mac.
Nothaft cited:
- Existing home sales averaged an annualized pace of 4.9 million the first three months of the year, the most since the fourth quarter of 2009.
- New home sales topped 424,000 during the first quarter, strongest showing since the third quarter of 2008.
- February marked the thirteenth consecutive month the Federal Housing Finance Agency has recorded a rise in its 12-month U.S. house price index, which rose 7.1% in the twelve months through February, the most since May 2006.
