Rates on the 30-year fixed mortgage fell from last week, even as the housing market showed more signs of weakness.
Government-sponsored mortgage finance giant Freddie Mac (FRE, Fortune 500) reported Thursday that 30-year fixed-rate mortgages averaged 6.47% this week. That's just below the previous week, but still under the 6.52% average a year ago.
"Even with the current historically affordable mortgage rates, news continues to show signs of weakening in the housing sector," said Frank Nothaft, Freddie Mac vice president and chief economist.
More bad news
He noted that housing starts fell in July to their slowest pace in 17 years, and homebuilder confidence remains at record-low levels.
Other mortgage rates also slipped this week, according to the Freddie Mac survey.
Rates on 15-year fixed-rate mortgages fell to 6.0%, down from 6.07% last week. Last year, the 15-year mortgage averaged 6.18%
The five-year adjustable-rate mortgage declined to 5.99%, down from 6.02% last week. At this point last year, it averaged 6.34%.
The rate on one-year adjustable-rate mortgages increased to 5.29%, compared to 5.18% last week. At this time last year, the 1-year ARM averaged 5.60%.
Reports on new and existing home sales for July are due next week. Also on tap is the S&P Case-Shiller home price index for June.
Meanwhile, mortgage application volume fell last week to its lowest level in nearly eight years, the Mortgage Bankers Association reported Wednesday. The sharp drop in refinancing volume in recent weeks has been the leading driver of the declining application volume.
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