Fixed Rates Lowest Since July '99

The average 30-year fixed mortgage rate fell to 7.54% for the week ending Dec. 8 -- its lowest level since the week ended July 23, 1999 -- from 7.65% the week before, according to Freddie Mac's Primary Mortgage Market Survey. The average 15-year fixed mortgage rate fell from 7.35% to 7.19%, while the average rate for one-year Treasury-indexed adjustable-rate mortgages decreased from 7.24% to 7.21%. Fees and points averaged 1.0 point for fixed-rate mortgages and 0.9 point for ARMs. "Reacting to recent economic indicators and affirmation by Federal Reserve Board Chairman Greenspan that the economy is indeed slowing, the markets began to anticipate that the Fed may lower interest rates in the near future," said Robert Van Order, Freddie Mac's chief economist. "This perception, in turn, caused mortgage rates to drop to their current lows." A year ago, the average 30-year and 15-year fixed rates were 7.84% and 7.45%, respectively, and the average one-year ARM rate was 6.45%, Freddie Mac said.