Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey^SM (PMMS^SM) in which the 30-year fixed-rate mortgage (FRM) averaged 5.53 percent, with an average 0.6 point, for the week ending June 30, 2005, down from last week when it averaged 5.57 percent. Last year at this time, the 30-year FRM averaged 6.21 percent.

The average for the 15-year FRM this week is 5.12 percent, with an average 0.6 point, down from last week when it averaged 5.16 percent. A year ago, the 15-year FRM averaged 5.62 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.06 percent this week, with an average 0.6 point, up slightly from last week when it averaged 5.05 percent. There is no annual historical information for last year since Freddie Mac only began tracking this mortgage rate at the start of this year.

One-year Treasury-indexed ARMs averaged 4.24 percent this week, with an average 0.7 point, also up slightly from last week when it averaged 4.23 percent. At this time last year, the one-year ARM averaged 4.19 percent.

"With still little or no threat of inflation to be found, long-term mortgage rates this week had some breathing room and that allowed rates to drift a little lower," said Frank Nothaft, Freddie Mac vice president and chief economist. "Short-term rates, though, may be another matter, since the Federal Reserve is expected to continue raising its target for the federal funds rate at least a few more times this year."

"Meanwhile, housing constituted 22 percent of the growth in real Gross Domestic Product (GDP) in the first quarter of this year. With mortgage rates hovering near historic lows, housing will undoubtedly continue to add to economic growth in the foreseeable future."

Published: July 1, 2005

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