US long-term mortgage rates have fallen to record lows for the 16th time in 2020 this week, amid an economy badly hit by the coronavirus pandemic
Mortgage giant Freddie Mac said on Thursday that the average interest rate on the 30-year fixed-rate home loan fell to a record low of 2.66% from 2.67% last week. A year ago it was 3.74%
The average rate on 15-year fixed-rate loans, popular among homeowners looking to refinance their mortgage, dropped from 2.21% to 2.19%. A year ago this was 3.19%.
The 5-year adjustable rate mortgage remained unchanged at 2.79% this week. A year ago this was still 3.45%.
Aided by lows, the housing market has been a source of strength in an economy hit by the coronavirus outbreak. The Federal Reserve has pushed the interest rate it controls to zero in an effort to help the economy recover from a spring shutdown.
But home sales have stalled due to a lack of housing on the market. On Wednesday, the Commerce Department reported that sales of new single-family homes fell 11% from October to November, although purchases are nearly 21% higher than a year ago.
“Towards 2021 we expect rates to remain stable, but the main driver in the short term will be the trajectory of the COVID-19 pandemic and the implementation of the vaccine,” said Freddie Mac chief economist Sam Khater.