McLEAN, VA -- In Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 5.99 percent, with an average 0.6 point, for the week ending September 27, 2002, falling from 6.05 percent last week. Last year at this time, the 30-year FRM averaged 6.72 percent. This is, once again, the lowest the 30-year FRM has been since Freddie Mac began tracking it in 1971.

The average for the 15-year FRM this week is 5.41 percent, with an average 0.6 point, down from last week’s average of 5.47 percent. A year ago, the 15-year FRM averaged 6.23 percent. This continues to be the lowest the 15-year FRM has been since Freddie Mac started following it in 1991.

One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 4.22 percent this week, with an average 0.6 point, down from last week’s average of 4.28 percent. This time last year, the one-year ARM averaged 5.45 percent. This is the lowest the 1-year ARM has been since the week ending February 18,1994, when it was 4.18 percent.

“The possibility that consumer spending will slow, given the current weakening level of consumer confidence, created an uneasy atmosphere in the financial markets,” said Frank Nothaft, Freddie Mac chief economist. “Combined with the growing possibility of a war with Iraq, new money flowed into the bond market, driving down yields and other interest rates. Mortgage rates were no exception.

“In the housing market, new home sales in August were up to an all-time high, reflecting the boom in housing construction at the start of the year. However, sales of existing homes appear to be leveling off as does the pace of new construction, indicating perhaps a return to a more sustainable rate of housing activity going into the new year.”

Published: September 27, 2002

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