With help from the Federal Reserve, mortgage rates plunged to tie the lowest on record for the week ending today, with the 30-year fixed loan down to 3.49 percent.
The Federal last week announced it would purchase $40 billion a month in mortgage-backed securities in an effort to spur job creation and lower borrowing costs. The 30-year stood at 3.55 percent a week ago, Freddie Mac said in a statement.
The real estate market appears to be recovering after more than three years of declines. Sales of existing homes rose to a two-year high in August, the National Association of Realtors said on Wednesday. Single-family housing starts advanced at the best pace since April 2010, the Commerce Department said.
The average 15-year mortgage declined to 2.77 percent from 2.85 percent, a record low, Freddie Mac reported.