Mortgage rates go below 3% amid the recent bond rally

• "Despite the re-acceleration of economic growth, the recent bond rally drove mortgage rates down for the second consecutive week," Freddie Mac's chief economist Sam Khater commented.
• 30-year fixed-rate mortgage averaged 2.98% with an average 0.7 point for the week ending November 11, 2021, down from last week when it averaged 3.09%. A year ago at this time, the 30-year FRM averaged 2.84%, according to the Freddie Mac Primary Mortgage Survey.
• 15-year fixed-rate mortgage averaged 2.27% with an average 0.6 point, down from last week when it averaged 2.35%. A year ago at this time, the 15-year FRM averaged 2.34%.
• 5-year Treasury (OTCQX:TSRMF)-indexed hybrid adjustable-rate mortgage averaged 2.53% with an average 0.4 point, down from last week when it averaged 2.54%. A year ago at this time, the 5-year ARM averaged 3.11%.
• "These low mortgage rates, combined with the tailwind of first-time homebuyers entering the market, means that purchase demand will remain strong into next year. However, affordability pressures continue to be an ongoing concern for homebuyers," Khater added.
• Last week the Federal Reserve announced that it would keep its main borrowing rate near zero; it will reduce its $120B in monthly bond purchases in the coming weeks, by $15B per month citing an improving economy and escalating concern that an inflation spike now seems likely to persist.
• Mortgage applications to purchase a home increased 3% for the week but were 4% lower than the same week one year ago.
• Refinance demand, which is highly sensitive to weekly rate moves, rose 7% last week from the previous week; it was 28% lower Y/Y.