May
26

Fixed-Mortgage, Unemployment Rates Find New Lows

May 26, 2011

We just discussed the myriad amount of foreclosures available at a deep discount to Chicago real estate buyers, now there’s more news to show the attractiveness of investing in a home right now.

Freddie Mac has released the results of its weekly Primary Mortgage Market Survey to show that fixed-rate mortgages continue to sink to new lows.

gold percentage symbol with an arrow going downEconomic activity pushed fixed-rate mortgages lower for the sixth straight week and are now at their lowest levels of the year.

Here’s the breakdown for the week ending May 26:

*30-year fixed-rate mortgage (FRM): Averaged 4.60 percent, down from last week when it averaged 4.61 percent. Last year at this time, the 30-year FRM averaged 4.84 percent.

*15-year FRM: Averaged 3.78 percent, down from last week when it averaged 3.80 percent. A year ago at this time, the 15-year FRM averaged 4.21 percent.

*5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM): Averaged 3.41 percent, down from last week when it averaged 3.48 percent. A year ago, the 5-year ARM averaged 3.97 percent.

*1-year Treasury-indexed ARM: Averaged 3.11 percent, down from last week when it averaged 3.15 percent. At this time last year, the 1-year ARM averaged 3.95 percent.

“The index of leading indicators fell 0.3 percent in April and represented the first monthly decline since June 2010. In addition, the Federal Reserve banks reported less business and manufacturing activity in Philadelphia, Chicago and Richmond,” said Frank Nothaft, vice president and chief economist for Freddie Mac.

“U.S. house prices indexes may be nearing a bottom soon. On a national basis, prices fell 0.3 percent between February and March, which was the smallest decline since November 2009, according to the Federal Housing Finance Agency. In addition, four of the nine Census Regions exhibited positive growth, compared to none in February.

“Separately, the Mortgage Bankers Association reported a further reduction in the serious delinquency rate (90 or more days plus foreclosures) in the first quarter, which stood at the lowest reading since the second quarter of 2009.”

And, some positive news at home: According to the Illinois Department of Employment Security, the unemployment rate in Illinois has fallen for the 15th straight month, dropping -0.1 to 8.7 percent in April.

That’s the lowest local unemployment rate since February of 2009 when it was 8.6 percent.

The national unemployment rate in April rose +0.2 to 9.0 percent.

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Tracey

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