WASHINGTON — Rates on 30-year fixed mortgages fell this week to the lowest level of the year and were barely higher than the all-time low.
Mortgage-finance company Freddie Mac said the average rate sank to 4.72 percent, down from 4.79 percent last week. It was just above the record of 4.71 set in December.
The average rate on a 15-year fixed- rate mortgage hit 4.17 percent, down from 4.2 percent last week and the lowest on records dating to August 1991.
Though mortgage rates are at attractive levels, the housing market hasn’t benefited. The number of customers applying for a mortgage to purchase a property fell to the lowest level in 13 years last week and was down 35 percent from a month ago, according to the Mortgage Bankers Association.
That’s a sign the market is struggling since the April 30 expiration of a tax credit of up to $8,000 for first-time buyers.
The government has taken massive steps to help the housing market recover. A campaign by the Federal Reserve to reduce borrowing costs for consumers pushed rates down to extraordinarily low levels last year. Rates were expected to rise after the program ended this spring but have fallen instead over the past two months.
Investors, wary of the European debt crisis and the turbulent stock market, have shifted money into the safety of U.S. Treasury bonds. That has pushed down the yield on U.S. Treasury debt. Fixed mortgage rates tend to track that yield.
