U.S. mortgage rates fell for a second week, holding at the lowest level in more than a year and a half, as declining financing costs boost loan demand.
The average rate for a 30-year fixed mortgage fell to 3.66 percent from 3.73 percent last week, Freddie Mac said in a statement today. The average 15-year rate declined to 2.98 percent from 3.05 percent, the McLean, Virginia-based mortgage-finance company said. Both are the lowest since May 2013.
Consumers, returning from the holidays, have taken advantage of dropping rates to purchase and refinance homes. The Mortgage Bankers Association’s loan applications index jumped 49 percent in the period ended Jan. 9 after an 11 percent increase the prior week, the Washington-based group said yesterday.
“It’s difficult to make a case that it’s not beneficial,” Paul Diggle, U.S. property economist for Capital Economics Ltd. in London, said in a telephone interview yesterday. “This is another boost for activity levels.”
The housing market is in a “slow and steady progression,” with choppiness in demand, Lennar Corp. said today. The company, the largest U.S. homebuilder by market value, reported an almost 50 percent jump in fiscal fourth-quarter profit, even as it increased incentives to boost sales.
KB Home, a Los Angeles-based builder, fell the most in more than two decades this week after saying profitability in 2015 will be restricted by flattening prices and land costs.