The 30-year fixed mortgage rate fell to yet another all-time low this week, marking the ninth time this year that rates have fallen to a new low, according to Freddie Mac.
Note rates averaged 2.86%, the lowest rate in the history of Freddie Mac’s mortgage rate survey dating back to 1971. That’s down from last week, when the 30-year fixed mortgage rate averaged 2.93%, and from the same week last year, when it averaged 3.56%.
The previous all-time low, 2.88% was recorded on the week ending August 6. Before this year, the all-time low was 3.31%, reached in November 2012; since 2020 started, 21 of 37 weeks have ended with a mortgage rate under that level.
“Mortgage rates have hit another record low due to a late summer slowdown in the economic recovery,” said Sam Khater, chief economist for Freddie Mac. “These low rates have ignited robust purchase demand activity, which is up 25% from a year ago and has been growing at double-digit rates for four consecutive months.
“However,” added Khater, “heading into the fall, it will be difficult to sustain the growth momentum in purchases, because the lack of supply is already exhibiting a constraint on sales activity.”
According to the National Association of Realtors’ most recent report, July’s unsold inventory of existing homes sat at a 3.1-month supply at the current sales pace, down from 3.9 months in June and down from the 4.2 months in July 2019. New homes, per the U.S. Census, were at a 4.0-month supply at the current sales rate in July, down 1.6% from June and 8.8% from July 2019.