Rates for home loans lurched lower, sending the benchmark below the key 4% threshold for the first time in six months, Freddie Mac said Thursday.
The 30-year fixed-rate mortgage averaged 3.97%, down 11 basis points during the week and below 4% for the first time since Nov. 17. The 15-year fixed-rate mortgage averaged 3.23%, down from 3.34%.
The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.10%, compared to 3.18% last week.
Those rates don’t include fees associated with obtaining mortgage loans.
The 10-year Treasury note
declined only slightly during the week, but many analysts are expecting it to fall further.
The next stop for 10-year Treasury yields is 2%, with the probability rising that we revisit 1.5% or lower this summer.
— Scott Minerd (@ScottMinerd) April 17, 2017
Investors sold bonds in the aftermath of the presidential election believing riskier assets held greater opportunity, and that higher inflation would erode the value of fixed-income investments.
Now, the promises of stronger economic growth, fiscal stimulus and tax reform all seem unlikely, and investors are reversing the “Trump trade.”