Benchmark mortgage rate drops in US housing market

WASHINGTON (Xinhua) – Mortgage rate decreased in the United States (US) last week, the US Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac, said on Thursday.

For the week ending January 9, 30-year fixed-rate mortgage (FRM) in the US decreased to 3.64 per cent from previous week’s 3.72 per cent.

However, 30-year FRM, the benchmark mortgage rate, was still significantly lower than the previous year. For the same period one year ago, the 30-year FRM averaged 4.45 per cent.

Besides, Freddie Mac noted that 15-year FRM this week dropped to 3.07 per cent from previous week’s 3.16 per cent.

The rate of 15-year FRM was also lower over the year and the figure was 3.89 per cent for the same period a year ago.

“Mortgage rates fell to the lowest level in 13 weeks, as investors sought the quality and safety of the US Treasury fixed income markets,” said Chief Economist of Freddie Mac Sam Khater.

“The drop in mortgage rates, combined with the strong labour market, should propel a continued rise in homebuyer demand,” said Khater.

Freddie Mac is a corporation founded by US Congress, aiming at promoting the stability and affordability in the US housing market by purchasing mortgages from banks and other loan makers.