Rates Down, New Home Construction Up
- Peter KingOctober 18, 2012 - MortgageLoan.com
Fixed mortgage rates ticked back down again this week, with 30- and 15-year loans once again at or near all-time lows, according to the weekly Freddie Mac rate survey.
Average interest rates on 15-year fixed-rate mortgages reached a record low of 2.66 percent this week, down from last week’s average of 2.70 percent. Meanwhile, 30-year fixed-rate mortgages dropped to an average of 3.37 percent, a single point above their all-time low and down from 3.39 percent last week.
Adjustable-rate mortgages (ARMs) were headed the other direction, although just barely. Initial rates on 5-year Treasury indexed ARMs rose to 2.75 percent, up from 2.73 percent last week.
Fixed-rates appear to have settled down for the time being after dropping about two-tenths of a percent in the wake of the Federal Reserve’s announcement in mid-September that it would undertake a third round of qualitative easing in an effort to boost lending and stimulate the economy.
Single-family home construction strengthens
Meanwhile, signs continue to point to a strengthening housing market. The Census Bureau announced Wednesday that construction starts on single-family homes rose a seasonally adjusted 11 percent in September, to an annual rate of 603,000 units. Building permits for single-family homes were up 6.7 percent over their August level, to a seasonally adjusted annual rate of 545,000 units.
Compared to one year ago, single-family housing starts were up 42.9 percent over their September 2011 level, while building permits were up 27.3percent.
When figures for multi-unit housing are included, such as for apartment buildings and condominium complexes, construction starts were up 15 percent over their August level and building permits were up by 11.6 percent. However, figures for multi-unit housing tend to be quite volatile, with big swings from month to month.
Builders more optimistic
Those figures are echoed by increasing optimism in the construction industry, with the National Association of Home Builders reporting this week that its index of homebuilder confidence reached its highest level since 2006 in October, with a reading of 41 on a scale where 50 represents builders are equally divided between positive and negative outlooks.
First published at: http://www.mortgageloan.com/rates-down-new-home-construction-9270
|30 yr fixed||3.79|
|15 yr fixed||3.04|
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