There were mixed behaviors of mortgage rates as Short Term Mortgage moves upward while Long Term moves downward. Freddie Mac released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 6.45 percent with an average 0.5 point for the week ending August 30, 2007, down from last week when it averaged 6.52. A year ago, the 30-year FRM averaged 6.44 percent.

The 15-year FRM this week averaged 6.12 percent, down from last week when it averaged 6.18 percent. Last year at this time, the 15-year FRM averaged 6.14 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.35 percent this week, up slightly from last week when it averaged 6.34 percent. Last year, the 5-year ARM averaged 6.11 percent.

One-year Treasury-indexed ARMs averaged 5.84 percent this week, up from last week when it averaged 5.60 percent. At this time last year, the 1-year ARM averaged 5.59 percent.

Frank Nothaft, Freddie Mac vice president and chief economist said that “Interest rates on conforming long-term fixed-rate mortgages declined slightly, while rates on one-year adjustable rate mortgages increased by about a quarter of a percent. The increase in ARM rates is consistent with movement of the yields on short-term Treasury securities, which have exhibited higher volatility recently due to market uncertainties."

“In other news, new home sales defied consensus expectations and rose in July to 870 thousand units, led by a 22 percent increase in the Western region. Existing home sales fell, however, though by less than the market had forecasted, to 5.75 million units, with the decline limited to the Midwest region.”
 
 Reference: FreddieMac,  Primary Mortgage Market Survey® (PMMS®), www.freddiemac.com
 

Existing-home sales dropped for the fifth straight time during July, while inventories of unsold property increased and prices dropped.

The sales of previously owned homes or “Home resales” decreased to 5.75 million annual rate, a decrease of 0.2% from June's revised 5.76 million annual pace, the National Association of Realtors said Monday. June's rate was originally estimated at 5.75 million.

The median home price was $228,900 in July, down 0.6% from $230,200 in July 2006. The median price in June this year was $229,200.

NAR economist Lawrence Yun said the housing market is holding on despite "temporary mortgage disruptions."

"Home sales probably would be rising in the absence of the mortgage liquidity issues of the past two months," Mr. Yun said. "Some buyers with contracts have been scrambling when loan commitments did not materialize at the last moment, while other potential buyers are simply waiting for the mortgage market to stabilize."

The average 30-year mortgage rate was 6.70% in July, up from 6.66% in June, according to Freddie Mac.

The July resales level was above Wall Street expectations of a 5.72 million sales rate for previously owned homes. The 5.75-million rate was the lowest since 5.73 million during November 2002.

Inventories of homes available for sale rose by 5.1% at the end of July to 4.59 million. That represented a 9.6-month supply at the current sales pace. There was a 9.1-month supply at the end of June, revised from a previously estimated 8.8 months.

Regionally, existing-home sales were mixed. Sales fell 2.2% in the Midwest, rose 1.0% in the Northeast, climbed 1.8% in the West, and remained flat in the South.
 

New-home sales ceased to drop in July, making an encouraging sign with a fairly small increase that gave the beleaguered housing market some encouraging signs as it challenged to resist what was expected.

The sales of single-family homes increased by 2.8% last month to a seasonally adjusted annual rate of 870,000, the Commerce Department said Friday. June new-home sales fell 4% to an annual rate to 846,000; originally, the government said June sales dropped by 6.6% to 834,000.

The median estimate of 23 economists surveyed by Dow Jones Newswires was a 1.4% decline in July sales to an 822,000 annual rate.

Year over year, new-home sales were 10.2% lower than the level in July 2006.

The ailing housing sector has pulled down U.S. economic growth for six straight quarters. Home builders are not doing well and in July they were at their lowest level in 10 years. Analysts expect the slump to continue. Lenders are tightening standards for borrowers, which sent up mortgage rates during the summer. Inventories of homes are running high.

Last week’s data showed the ratio of new houses for sale to houses sold slipped in July, falling to 7.5 from 7.7 in June. There were an estimated 533,000 homes for sale at the end of July, down from June's 538,000.

There was an increase in median price of a new home by 0.6% to $239,500 last month from $238,100 in July 2006. The average price decreased by 3.4% to $300,800 from $311,300 a year earlier. In June this year, the median price was $230,600 and the average was $304,900.

Regionally last month, new-home sales increased 22.4% in the West and 0.6% in the South. Demand plunged 24.3% in the Northeast and dropped 0.9% in the Midwest. An estimated 74,000 homes were actually sold in July, down from 77,000 in June, based on figures not seasonally adjusted.
 

The results of Freddie Mac's Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 6.52 percent with an average 0.4 point for the week ending August 23, 2007, down from last week when it averaged 6.62. Last year at this time, the 30-year FRM averaged 6.48 percent.

The 15-year FRM this week averaged 6.18 percent with an average 0.5 point, down from last week when it averaged 6.30 percent. A year ago, the 15-year FRM averaged 6.18 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.34 percent this week, with an average 0.6 point, down from last week when it averaged 6.35 percent. A year ago, the 5-year ARM averaged 6.14 percent.

One-year Treasury-indexed ARMs averaged 5.60 percent this week with an average 0.6 point, down from last week when it averaged 5.67 percent. At this time last year, the 1-year ARM averaged 5.60 percent.

Frank Nothaft, vice president and chief economist of Freddie Mac, said “Interest rates on conforming long-term fixed-rate mortgages and one-year adjustable rate mortgages trended down by about one-tenth of a percent in the past week,” “This is as a result of yields on Treasury securities coming down, and the Fed’s decision to cut the discount rate by half a percent to 5.75 percent last Friday.

“Additionally, economic indicators released in the past week reflect slowing housing activity in July. Last month’s housing starts dropped to the lowest level since January 1997 at an annualized pace of 1.38 million units, while one-unit housing starts experienced the fourth consecutive month of decline. Building permits also fell to the lowest level in nearly 11 years, and the number of one-unit permits issued was at the lowest since June 1995.”
 

Source: Freddiemac, Primary Mortgage Market Survey® (PMMS®), www.freddiemac.com
  
 
 

The mortgage rates increased this week according to the results of Freddie Mac's Primary Mortgage Market Survey. Shorter term rates were all up slightly in that survey.

The Freddie Mac survey found that the 30-year fixed-rate mortgage (FRM) started to increase as it experienced a decline last week. It now averaged 6.62 percent with an average 0.4 point for the week ending August 16, 2007, up from last week when it averaged 6.59. Last year at this time, the 30-year FRM averaged 6.52 percent

The 15-year FRM this week averaged 6.30 percent with an average 0.5 point, up from last week when it averaged 6.25 percent. A year ago, the 15-year FRM averaged 6.20 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.35 percent this week, with an average 0.5 point, up from last week when it averaged 6.33 percent. A year ago, the 5-year ARM averaged 6.18 percent.
One-year Treasury-indexed ARMs averaged 5.67 percent this week with an average 0.6 point, up from last week when it averaged 5.65 percent. At this time last year, the 1-year ARM averaged 5.65 percent.

"Interest rates on prime conforming fixed-rate mortgages eased further in the past week, according to the Primary Mortgage Market Survey, even though other sources such as HSH Associates reported that jumbo fixed rates increased by a quarter percent or more last week," said Frank Nothaft, Freddie Mac vice president and chief economist. "Job creation fell short of market expectations, with 92,000 jobs added in July, the smallest gain since February, and June's number was revised down by 6,000. In addition, the unemployment rate ticked up for the first time in four months to 4.6 percent.

Source: Freddiemac, Primary Mortgage Market Survey® (PMMS®), www.freddiemac.com