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Mortgage Rates Down; Volatility Continues

Volatility of mortgage rates, or interest rates on home loans, continues, as the metric dropped this week, according to mortgage provider Freddie Mac (FMCC.OB).

Releasing the results of its primary mortgage market survey, Freddie Mac said that the 30-year fixed-rate mortgage or FRM averaged 5.30 percent for the week ending July 28, 2022, down from 5.54 percent last week. A year ago at this time, the average rate was 2.80 percent.

The 15-year FRM this week averaged 4.58 percent, down from 4.75 percent last week. A year ago at this time, the 15-year FRM averaged 2.10 percent.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage or ARM averaged 4.29 percent, down from 4.31 percent last week. It was 2.45 percent a year ago.

"Purchase demand continues to tumble as the cumulative impact of higher rates, elevated home prices, increased recession risk, and declining consumer confidence take a toll on homebuyers," said Sam Khater, Freddie Mac's Chief Economist. "It's clear that over the past two years, the combination of the pandemic, record low mortgage rates, and the opportunity to work remotely spurred greater demand. Now, as the market adjusts to a higher rate environment, we are seeing a period of deflated sales activity until the market normalizes."

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