Activity and Value Of Housing Remain At High Levels

McLEAN, VA -- In Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 6.71 percent, with an average 0.7 point, for the week ending June 7, 2002, down from 6.76 percent last week. Last year at this time, the 30-year FRM averaged 7.20 percent. The 30-year FRM has not been this low since the week ending November 16, 2001, when it averaged 6.51 percent.

The average for the 15-year FRM this week is 6.18 percent, with an average 0.7 point, falling from last week's average of 6.22 percent. A year ago, the 15-year FRM averaged 6.74 percent. The 15-year FRM has not been this low since the week ending November 16, 2001, when it averaged 5.98 percent.

One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 4.71 percent this week, with an average 0.5 point, down from last week's average of 4.76 percent. This time last year, the one-year ARM averaged 5.85 percent. The 1-year ARM has not been lower since April 1, 1994, when it averaged 4.65 percent. (Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)

"Mortgage rates have been under seven percent for the past eight weeks," said Frank Nothaft, Freddie Mac's chief economist. "During that time, mortgage applications for home purchases have continued to reach historically high levels, keeping homes sales moving at a vibrant pace.

"This week, Freddie Mac also released its Conventional Home Price Index for the first quarter, which showed house price growth rebounded in the first quarter to an impressive annualized rate of 5.7 percent. This indicates that housing continues to be a solid investment."