US long-term mortgage rates hit new lows; 30-year at 2.65%

U.S. long-term mortgage rates declined this week to new record lows for the first week of 2021

WASHINGTON -- U.S. long-term mortgage rates declined this week to new record lows for the first week of 2021.

Mortgage buyer Freddie Mac reported Thursday that the average rate on the benchmark 30-year fixed-rate home loan slipped to 2.65% from 2.67% from last week. By contrast, the rate stood at 3.64% a year ago.

The average rate on 15-year fixed-rate loans, popular among homeowners seeking to refinance their mortgages, ticked down to 2.16% from 2.17%.

Mortgage rates are set to rise modestly this year as economic factors shift, according to Freddie Mac chief economist Sam Khater. The record-low lending rates have helped push buyers into the housing market, but a lack of available homes has left many would-be homebuyers empty-handed. The lack of supply has pushed prices up even before the pandemic struck last March.

A continued rise in home prices could intensify the squeeze on potential purchasers during the spring homebuying season, Khater says.

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