Mortgage rates fell for the fourth week in a row, with
Not since the end of October have rates been so low, according to the survey -- an enticement for borrowers to enter the sputtering housing market or in some cases refinance their homes.
The average offering rate for 15-year fixed mortgages dropped from 3.29% to 3.25%, Freddie Mac said Thursday -- also the lowest point since Halloween decorations were up.
The average start rate for a loan that becomes variable after five years fixed was 2.96%, down from 3.01% and the lowest since December.
The decline comes amid mixed economic news.
Freddie Mac's chief economist, Frank Nothaft, noted that industrial production slipped 0.6% in April, below consensus expectations. A slowing economy tends to reduce inflation worries and make bonds a more attractive investment, both of which put downward pressure on interest rates.
On the other hand, the housing market, which had been a drag on the economy, is showing flickers of life. Seasonally adjusted home resales rose 1.3% from March to April, the first gain this year, the National Assn. of Realtors said Thursday.
The trade association said the number of homes offered for sale had increased "meaningfully" as price increases moderated.
"We'll continue to see a balancing act between housing inventory and price growth, which remains stronger than normal simply because there have not been enough sellers in many areas," said Lawrence Yun, chief economist for the real-estate lobbying group.
"More inventory and increased new-home construction will help to foster healthy market conditions," Yun said.