30-Year Mortgage Rates Hit All-Time Low

30-year mortgage rates have officially hit an all-time new low of 3.84 percent, which is below the previous record of 3.87, which occurred in February 2012, according to a statement by Freddie Mac.

Frank Nothaft, Freddie Mac’s chief economist, stated that:

“Signs of slowing economic growth and inflation remaining subdued allowed yields on Treasury bonds to ease somewhat and brought most mortgage rates to new all-time record lows this week.”

15-year mortgage rates have also reached a new low record of 3.07 percent, with the previous record of 3.11 percent having been hit three weeks ago.

Unfortunately, cheaper mortgage rates have not helped to boost home sales, as rates have fallen below 4 percent for almost every week since December.

March saw both sales of new and previously occupied homes fall. This is due to a warm winter, according to analysts, who have said that a lot of home sales which usually take place in spring happened in January or February instead.

Despite low 30-year mortgage rates, many potential buyers are either unable to qualify for a loan, or are unable to afford a higher down payment that is required by the bank. Also, many who can afford to either buy or refinance have already taken advantage of the lower rates.

The Freddie Mac data for mortgage rates goes back to 1991. The reason for the low rate is attributed to the fact that they tend to track the yield on a 10-year Treasury note. Mixed news regarding the world economy, including Europe’s debt crisis, and the iffy S.X. economy, has led investors to buy more Treasury notes, which are considered a safer investment. As demand for these Treasury notes grows, the yield, and therefore 30-year mortgage rate, falls.

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