Fixed Mortgage Rates in U.S. Dip Below Last Year's Rates

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According to Freddie Mac's latest Primary Mortgage Market Survey (PMMS), the average fixed rate mortgage is moving lower following the release of the first quarter real GDP final estimate. Fixed mortgage rates are lower this week than at the same time last year when Fed remarks spurred market speculation that it could begin tapering its bond purchases causing mortgage rates to spike.

Freddie Mac's chief economist Frank Nothaft said, "Mortgage rates were down following the release of first quarter real GDP final estimate, which fell at a 2.9 percent annualized rate, a steeper than expected decline and the worst reading since the first quarter of 2009. Also, the seasonally-adjusted S&P/Case-Shiller 20-city home price index was up only 0.2 percent in April from the previous month. On a year-over-year basis, prices remained strong in April up 10.8 percent, but slower than the 12.3 percent in March."

Freddie Mac report highlights include:

• 30-year fixed-rate mortgage (FRM) averaged 4.14 percent with an average 0.5 point for the week ending June 26, 2014, down from last week when it averaged 4.17 percent. A year ago at this time, the 30-year FRM averaged 4.46 percent.

• 15-year FRM this week averaged 3.22 percent with an average 0.5 point, down from last week when it averaged 3.30 percent. A year ago at this time, the 15-year FRM averaged 3.50 percent.

• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.98 percent this week with an average 0.3 point, down from last week when it averaged 3.00 percent. A year ago, the 5-year ARM averaged 3.08 percent.

• 1-year Treasury-indexed ARM averaged 2.40 percent this week with an average 0.4 point, down from last week when it averaged 2.41 percent. At this time last year, the 1-year ARM averaged 2.66 percent.