Fixed mortgage rates end year above record lows

WASHINGTON (AP) — Fixed mortgage rates rose slightly this
week off their record lows. The year ends much like it began, with few
people able to take advantage of the best rates in history.
Freddie
Mac said Thursday that the average on the 30-year home loan increased
to 3.95 percent from 3.91 percent. Last week’s rate was the lowest
average on records dating to the 1950s.
The average on the 15-year fixed mortgage rose to 3.24 percent. That’s up from 3.21 percent, also a
record low.
Rates
have been below 5 percent for all but two weeks in 2011. Even so, this
year is shaping up to be one of the worst ever for home sales.
Previously
occupied homes are selling just slightly ahead of last year’s dismal
pace. And new-home sales appear headed for their worst year on records
going back half a century.
Next year could be better. More than 5
percent of households said this month they plan to purchase a home
within the next six months, according to the Conference Board.
Builders
are also hopeful that the low rates could boost sales next year. Low
mortgage rates were cited as a key reason the National Association of
Home Builders survey of builder sentiment rose in December to its
highest level in more than a year.
But so far, rates are having no
major impact. Mortgage applications have fallen slightly in recent
weeks, according to the Mortgage Bankers Association.
High
unemployment and scant wage gains have made it harder for many people to
qualify for loans. Many Americans don’t want to sink money into a home
that they fear could lose value over the next few years.
To
calculate the average rates, Freddie Mac surveys lenders across the
country Monday through Wednesday of each week. The average rates don’t
include extra fees, known as points, which most borrowers must pay to
get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for the 30-year loan was unchanged at 0.7; the average on the 15-year fixed mortgage was
unchanged at 0.8.
For
the five-year adjustable loan, the average rate rose to 2.88 percent
from 2.85 percent. The average on the one-year adjustable loan ticked up
to 2.78 percent from 2.77 percent.
The average fees on the five- and one-year adjustable-rate loans were unchanged at 0.6.
Copyright 2011 The Associated Press.