Mortgage rates rose slightly this week amid reports of uncertainty in the continuously falling economy. The rate for 30-year fixed mortgage showed a rise of just 0.03 percent from 5.04 previous week to 5.07 this week.
During the same period, the five-year adjustable-mortgage rate increased from 5.04 percent to 5.06 percent and the one-year ARM from 4.80 percent to 4.81 percent, according to the report of Freddie Mac for the week ended Feb 26. The interest rate for 15-year fixed mortgage remained at 4.68 percent.
In the present scenario, even affordable mortgage rates and lower house prices are not improving housing market. According to the purchase-only monthly home price index of the Federal Housing Finance Agency for the year ending December 2008, house prices recorded a fall of 8.7 percent. In January, existing home sales declined by 4.7 percent to 4.05 million units, which is the slowest pace since July 1997.