The average rate on the 30-year home loan dropped to 3.15 percent from 3.24 percent last week, according to mortgage buyer Freddie Mac. This is the lowest level since Freddie Mac started tracking rates in 1971. A year ago the rate was 3.99 percent. The average rate on the 15-year fixed-rate mortgage declined to 2.62 percent from 2.70 percent last week. According to Freddie economists, the increased demand for home purchases by prospective buyers, spurred by the decline in borrowing rates, has jumped from a decline of 35 percent in mid-April to an increase of eight percent as of last week.
The National Association of Realtors reported last week that April saw a record decline in the signing of contracts to buy homes, reflecting the economic damage from the Covid-19 virus that shut down much of the country’s business and social life. Pending home sales fell 21.8 percent from March, the largest decline going back to 2001.