Mortgage rates slipped this week as the coronavirus keeps affecting the overall U.S. economy, according to Freddie Mac.
The 30-year fixed-rate mortgage averaged 3.31% for the week ending April 16,
"Mortgage rates continue to hover near all-time lows for the third straight week. As a result, refinance activity remains high, but home purchase demand is weak due to economic tightening," Sam Khater, Freddie Mac's chief economist, said in a press release.
"While new monthly economic data are driving markets lower this week, they are a lagging indicator and should be priced in already. Real time daily economic activity metrics suggest that the economy will likely not decline much further. Going forward, the key question is no longer the depth of the economic contraction, but the duration."
The 15-year fixed-rate mortgage averaged 2.8%, up from last week when it averaged 2.77%. A year ago at this time, the 15-year fixed-rate mortgage averaged 3.62%.
The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.34% with an average 0.3 point, down from last week when it averaged 3.4%. A year ago at this time, the five-year adjustable-rate mortgage averaged 3.78%.
"Amid a sea of uncertainty, the market began to show signs of stability over the past seven days as mortgage rates increased. While day-to-day changes in rates remain quite substantial by historic standards, the wild swings have calmed in recent weeks after a period of extreme fluctuations. This suggests the historic intervention by the Federal Reserve has successfully eased some of the strains that had plagued the market just a few weeks ago, though challenges remain," Zillow economist Matthew Speakman said when that company released its own rate tracker.
"Still, much like last week, looking solely at the market for conventional loans only tells part of the story. Limits to forbearance offerings, not to mention high degrees of uncertainty around the credit worthiness of some borrowers, continue to restrict market activity for non-agency and unconventional loans. The outlook for the coming months remains very uncertain, so the appearance of a calmer market of late could be a mirage as the likelihood of a sharp move in financial markets is still quite high," Speakman said.
