Mortgage rates in the United States hit 2014's lowest level for the week ended Oct. 8, according to Freddie Mac's latest primary mortgage market survey.
The average 30-year-fixed mortgage rates slumped to 4.12 percent from last week's 4.19 percent. The rate was 4.23 percent at the same time, last year.
The average 15-year-fixed mortgage rates went down to 3.30 percent from last week's 3.36 percent. It averaged 3.31 percent at the same time, last year.
The five-year treasury-indexed hybrid adjustable mortgage rate declined to 3.05 percent from last week's 3.06 percent. The rate was 3.05 percent a year ago.
The average one-year treasury-indexed adjustable mortgage rate was the only rate that remained unchanged at 2.42 percent from last week. The rates averaged 2.64 percent at the same time last year.
Experts at Freddie Mac attributed the fall in rates to uncertainty about the Federal reserve's interest rate hike plan and also Europe's economic gloom, but added that mortgage applications were up due to a stronger jobs report.
"Fixed mortgage rates were down on a week filled with bleak forward projections from the Federal Reserve and concern over growth in Europe. Despite gloomy vernacular from the Fed, mortgage purchase applications were up 2 percent on the week and the labor market added 248,000 jobs, beating expectations and lowering headline unemployment to 5.9 percent," Frank Nothaft, chief economist and vice president at Freddie, said in a statement.
According to the Mortgage banking Association, applications for refinancings went up 5 percent from a week ago and new home purchase applications also increased two percent.
"The purchase index reached its highest level since July," said Michael Fratantoni, the MBA's chief economist. "The increase was led by a 3.7 percent increase in government purchase volume for the week."
Earlier this week, the labor department said that the U.S. jobless rates fell to 5.9 percent, its lowest since July 2008. However, earnings and underemployment was still high, which tempered down the job growth report.
Industry experts earlier said that the low mortgage rates wouldn't help home buying activity unless earnings and employment improved. The recent developments do paint a bright picture and with Americans growing more confident about the housing market, the economy could see significant growth in the coming future.
