30-Year Rates Drop to 4-Year Low
January 26, 2008 by Dave Bender
Rates on 30-year mortgages dropped for a fourth straight week, reaching the lowest level in nearly four years and raising hopes that low rates will help spur a rebound in the hard-hit housing industry.
Freddie Mac reported Thursday that 30-year, fixed-rate mortgages averaged 5.48 percent this week, down from 5.69 percent last week.It was the fourth consecutive decline and the third straight week that rates have been below 6 percent. The new rate was the lowest for 30-year mortgages since they averaged 5.40 percent the week of March 25, 2004.Economists attributed the decline to further weak news on the economy combined with the biggest reduction of a key interest rate by the Federal Reserve in more than 20 years as it steps up its efforts to combat a threatened economic recession.”When the Federal Reserve cut the target for the federal funds rate by three-quarters of a percentage point, the action was extraordinary in both the magnitude and the timing of the rate cut,” said Frank E. Nothaft, chief economist at Freddie Mac.
