(Bloomberg News) Mortgage rates in the U.S. declined for a third week, reaching record lows as the housing market shows signs of stabilizing.
The average rate for a 30-year fixed loan fell to 3.83 percent in the week ended today from 3.84 percent, Freddie Mac said in a statement. It was the lowest in the McLean, Virginia- based mortgage-finance company's data dating to 1971. The average 15-year rate dropped to 3.05 percent, also the lowest on record, from 3.07 percent.
The U.S. property market appears to be bottoming as low borrowing costs and improving employment fuel demand for a shrinking inventory of available homes. Prices for single-family houses climbed in the first quarter from a year earlier in 74 of 146 metropolitan areas measured, the National Association of Realtors said in a report yesterday.
"Pricewise, it looks like we've probably bottomed," Brian Jones, senior U.S. economist for Societe Generale SA in New York, said in a telephone interview yesterday. "But it's slow and steady improvement."
At the end of March, 2.37 million previously owned homes were available for sale, 22 percent fewer than a year earlier, the Realtors said. Purchases of existing houses rose 5.3 percent in the first quarter from a year earlier.
The Mortgage Bankers Association's index of purchase applications increased 3.4 percent in the week ended May 4, while the refinancing gauge climbed 1.3 percent, the Washington- based group said yesterday.