Mortgage demand rises for second week
Interest rates, however, were well below year-ago levels of 6.22 percent. Treasury yields, which are linked to mortgage rates, have fallen recently, with mortgage rates responding in kind. Mortgage rates, however, remained above 5 percent for a seventh straight week. Experts say mortgage rates at 5 percent and below are what is necessary to make a significant impact on home loan demand. The MBA’s seasonally adjusted purchase index fell 9.4 percent to 258.8, the lowest reading since the week ended May 22.
MSNBC.com July 15, 2009
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 5.05 percent, down 0.29 percentage point from the previous week, the lowest since the week ended May 22, but higher than the all-time low of 4.61 percent set in the week ended March 27. The survey has been conducted weekly since 1990.
The housing sector, however, has been showing some signs of stabilization, with sales rising and home price declines moderating in many regions of the country.
“We are probably at or near a bottom in the Manhattan market,” Ramirez said.
“It seems like the worst is behind it,” she said.
The U.S. government has embarked on an aggressive plan to bring mortgage rates down to levels that will spur demand and help the hard-hit housing market begin to recover.
The Federal Reserve has set a goal to buy up to $1.25 trillion of agency MBS, $300 billion of Treasuries and $200 billion of agency debt in 2009. The purchases are part of efforts to lower borrowing costs.
Fixed 15-year mortgage rates averaged 4.59 percent, down from 4.83 percent the previous week. Rates on one-year ARMs decreased to 6.47 percent from 6.58 percent.
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