Housing Shifts More Toward Buyer's Market This Year

Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMSSM) in which the 30-year fixed-rate mortgage (FRM) averaged 6.47 percent with an average 0.4 point for the week ending September 7, 2006, up from last week's average of 6.44 percent. Last year at this time, the 30-year FRM averaged 5.71 percent.
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The average for the 15-year FRM this week is 6.16 percent with an average 0.4 point, up from last week when it averaged 6.14 percent. A year ago, the 15-year FRM averaged 5.30 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.14 percent this week, with an average 0.5 point, up from last week's rate of 6.11 percent. A year ago, the five-year ARM averaged 5.24 percent.

One-year Treasury-indexed ARMs averaged 5.63 percent this week with an average 0.7 point, up from last week when it averaged 5.59 percent. At this time last year, the one-year ARM averaged 4.45 percent.

"We expect that mortgage rates will continue to fluctuate as new economic data are released, but still remain in the 6.5 percent to 7 percent range for the rest of the year," said Frank Nothaft, Freddie Mac vice president and chief economist. "Slowly rising mortgage rates are offset in part by a slowdown in house price appreciation."

"Consequently, higher rates have resulted in houses sitting on the market for longer periods of time, changing the real estate sector into more of a buyer's market from the seller's market of the last few years. This is a plus, as it allows potential homebuyers more time to look around and decide what they really want and what they can afford."